PRO  AND  CON 


BEING  A detailed  REPORT  OF  THE 

CHICAGO  TRUST  CONFERENCE 

HEI<D  IN  CHICAGO,  SEPTEMB^^^^-¥S’  1899. 

UNDER  the  auspices  OP  THE  , : , 

CIVIC  KEDERATION 


W.  BOURKE  COCKRAN 

vs. 


WILLIAM  JENNINGS  BRYAN 


BEING  A detailed  report  OF  THE 


CHICAGO  TRUST  CONFERENCE 

HEED  IN  CHICAGO,  SEPTEMBER  13-16,  1 899, 

UNDER  the  AUSPICES  OF  THE 

CIVIC  KKDERATION 


W.  BOURKE  COCKRAN 

VS. 

WILLIAM  JENNINGS  BRYAN 


II<I,USTRATED 


CHICAGO 

GEO.  M.  00. 

PUBLIvSHERS 


Copyright,  1899,  by 
GEO.  M*  HILL  CO.,  Chicago. 


' f 


CONTENTS. 


The  Trust  Conference 

FIRST  DAY. 


PAGE 

. 5 


' Addresses  of  Welcome: 

J ' Attorney  General  Akin  of  Illinois 

Dr.  Howard  S.  Taylor  of  Chicago *.**’* 

J Pres.  Franklin  H.  Head  of  the  Civic  Federation.*  .*  .*  .* ! .* 

.w  Problems  Before  the  Conference,  Prof.  J.  W.  Jenks 

^ Trust  Problems,  Prof.  H.  C.  Adams ...*!.'.*.*.* 

Trust  Question  as  Texas  Sees  It,  Dudley  Wooten 

Are  the  New  Combinations  Dangerous?  Prof.  J.  G.  Brooks. 

A Hopeful  Course  of  Procedure,  William  Fortune 

Opposed  to  Trusts,  Gov.  G.  W.  Atkinson  of  West  Virginia 

Trust  Debts  Must  Be  Placed,  C.  E.  Crow 

Trusts  Hurt  Salesmen,  P.  E.  Dowe .*.*.*.*.*.*.** 

Competition  Postered  by  Trusts,  Francis  B.  Thurber 

Limitations  of  Competition  and  Combination,  Joseph 

Nimmo,  Jr 

Review  of  First  Day,  Dr.  Albert  Shaw !!!!!*.!!*. 

Review  of  First  Day,  Prof.  J.  R.  Commons 


7 

9 

11 

13 

20 

26 

32 

36 

37 

41 

42 
44 

46 

47 
49 


SECOND  DAY. 


Trusts  and  the  Tariff,  Lawrence  Purdy 

Tariff  the  Mother  of  Trusts,  Byron  W.  Holt 

Tariff  Does  Not  Favor  Trusts,  J.  P.  Scanlan 

Tariff  or  Trusts,  Which?  Hon.  Thos.  Updegraff 

Excessive  Financial  Energy,  H.  W.  Seymour .*  .* 

Protection  of  Grain  Markets,  S.  H.  Greeley 1 .*  .*  .* 

Foreign  Markets  and  American  Shipping,  J.  C.  Hanley 

Agriculture  and  Trusts,  Aaron  Jones .* 

Anarchism  and  Trusts,  Benjamin  R.  Tucker 

Trusts  and  Our  National  Life  and  Citizenship,  Gov.  H.  S*. 

Pingree  of  Michigan * 

Trusts  Have  Come  to  Stay,  Hon.  Charles  W.  Foster 

Arkansas  Law  as  Applied  to  Trusts,  Hon.  Jefferson  Davis.*.* 

3 


51 

53 

56 

58 

59 
62 

63 

64 

65 

67 

72 

74 


4 


CONTENTS. 


PAGE 


Trusts  Part  of  Progress,  George  Gunton. 75 

Congress  Should  Control,  Hon.  T.  R.  Gaither,  Jr 76 

Re-view  of  Second  Day,  Dr.  Albert  Shaw 77 

Review  of  Second  Day,  Prof.  J.  R.  Commons 79 

THIRD  DAY. 

Single  Tax  View,.  Louis  P.  Post 82 

Trusts  from  the  Socialists’  Point  of  View,  Thos.  J.  Morgan.  82 

Trusts  and  Combinations,  John  W.  Hayes 84 

Trusts  and  Organized  Labor,  Henry  White 87 

Trusts  and  Unions,  Samuel  Gompers 88 

A Practical  View,  M.  M.  Garland 90 

Caution  Against  Demagogues,  David  Ross 91 

Government  Ownership,  M.  L.  Lockwood 92 

New  Jersey  and  The  Trusts,  Edward  Keasbey 94 

The  Trust  Problem,  Prof.  E.  W.  Bemis 95 

Regulation  of  Trusts,  Prof.  John  B.  Clark 96 

The  Paramount  Issue,  Hon.  Wm.  D.  Foulke 100 

Trust  Remedies,  Edward  Rosewater 103 

Industrial  Combinations,  Hon.  W.  Bourke  Cockran 106 

Brief  Response  by  Hon.  W.  J.  Bryan 136 

FOURTH  DAY. 

Industrial  Combinations,  Hon.  W.  J.  Bryan 138 

Monopolies  Under  Patents,  J.  H.  Raymond 162 

Remedies  for  Industrial  Trusts,  G.  W.  Northrup 162 

Civic  Federation  on  Trusts,  Prof.  David  Kinley 163 

Trusts  from  a Business  Man’s  Standpoint,  T.  B.  Walker. . . 164 

On  Texas  Law,  Hon.  T.  S.  Smith 165 

New  Jersey  Trusts,  J.  B.  Dill 165 

General  Discussion: 

Foulke  Challenges  Bryan 166 

Chicagoan  Defies  Cockran 167 

Bryan  Replies  to  Foulke 167 

Cockran  Replies  to  Bryan 173 

Senator  Blair  of  New  Hampshire 180 

No  Resolutions  180 

The  Last  Word,  Hon.  Wm.  Wirt  Howe 181 

Adjournment 182 


Trusts-Pro  and  Con. 


TEE  TRUST  CONFERENCE. 


The  Civic  Federation  of  Chicago,  in  view  of  the  wide- 
spread interest  in  the  subject  of  trusts  and  industrial  com- 
binations, decided  to  invite  the  leading  thinkers  of  the 
country  to  assemble  in  Chicago  in  September  to  discuss 
this  great  question.  Governors  of  states  were  invited  to 
be  present,  and  to  appoint  the  strongest  controversialists 
in  their  respective  states  to  accompany  them.  National 
labor  organizations  were  also  asked  to  send  delegates,  as 
were  boards  of  trade  in  all  the  large  cities,  and,  in  fact,  all 
organizations  of  any  standing  whatsoever  were  asked  to 
be  represented  in  the  conference.  Special  invitations  were 
issued  to  colleges  and  universities  to  send  their  professors. 

As  a result  a most  distinguished  assemblage  of  over  five 
hundred  delegates,  including  governors  of  states,  sen- 
ators, congressmen,  attorneys,  college  presidents,  and 
professors,  trust  officers,  business,  laboring  and  professional 
men  responded  to  the  roll  call  at  the  opening  of  the  con- 
ference in  Central  Music  Hall  on  the  morning  of  Septem- 
ber 13. 

Addresses  of  welcome  were  delivered  by  Attorney  Gen- 
eral E.  C.  Akin  in  behalf  of  Governor  Tanner;  Dr.  How- 
ard S.  Taylor  in  behalf  of  Mayor  Harrison,  and  by  Presi- 
dent Franklin  H.  Head  of  the  Civic  Federation.  The  offi- 
cers of  the  Civic  Federation  were  made  the  temporary  offi- 
cers of  the  conference,  Ealph  M.  Easley  being  the  secretary. 

The  Civic  Federation  had  arranged  no  program  beyond 
the  opening  session,  and  thus  the  whole  proceeding  was  in 
the  hands  of  the  delegates.  By  unanimous  consent  this 
opening  program  was  carried  out,  and  Prof.  J.  W.  Jenks  of 
Cornell  University  was  introduced  and  spoke  on  ^‘^Trust 
Problems.^^ 


5 


6 


TRUSTS — PRO  AKD  CON. 


The  various  delegations  were  asked  to  appoint  members 
of  a program  committee. 

The  speakers  in  the  afternoon  session  were  Dr.  H.  C. 
Adams  of  the  University  of  Michigan,  Dudley  Wooten  of 
Texas,  Prof.  John  Graham  Brooks  of  the  University  of 
Chicago,  Hon.  William  Fortune  of  Indiana.  In  the  even- 
ing session  the  following  spoke:  Gov.  G.  W.  Atkinson  of 
West  Virginia,  Hon.  C.  E.  Crow,  Attorney  General  of  ]\Iis- 
souri;  P.  E.  Dowe,  president  of  the  Commercial  Travel- 
ers^ National  League;  Francis  B.  Thurber  of  New  York, 
and  Joseph  Nimmo,  Jr.,  of  Washington. 

The  committee  on  organization  chose  Judge  William 
Wirt  Howe  of  New  Orleans  as  permanent  chairman  of  the 
conference. 

The  conference  thus  permanently  organized  proceeded 
as  shown  in  the  following  pages.  All  the  leading  speeches 
are  printed  in  full,  and  the  arguments  of  all  the  speeches 
are  given,  in  the  order  in  which  they  were  delivered. 


ADDRESSES  OE  WELCOME. 


ATTORNEY-GENERAL  AKIN. 

Attorney-General  Akin  delivered  the  address  of  wel- 
come^ taking  the  place  of  Governor  Tanner,  who  was  de- 
tained by  illness.  He  spoke  as  follows: 

Gentlemen,  governors  and  representatives  of  sister 
states  and  members  of  visiting  delegations:  The  pleasure 
of  addressing  you  on  this  occasion  is  as  gratifying  as  it  is 
unexjjected,  and  the  fact  that  the  substitutions  were  an- 
nounced long  before  either  Governor  Tanner  or  myself  knew 
of  any  such  purpose  is  but  a deserved  compliment  to  the 
energy  and  prophetic  power  of  the  average  Chicago  news- 
paper reporter. 

Owing  to  the  serious  illness  of  Governor  Tanner,  which 
alone  prevents  his  presence  here  to-day,  the  privilege  of 
welcoming  you  on  this  occasion  has  been  generously  ac- 
corded to  me.  The  casual  stranger,  who  comes  without  evil 
intent,  is  entitled  to  passive  welcome  as  a matter  of  mere 
courtesy,  hut  to  you  a most  generous  welcome  is  due,  be- 
cause many  of  you  occupy  positions  of  high  trust  and  im- 
p»ortance  in  the  various  states  you  represent,  because  among 
you  are  the  leading  minds  in  the  great  world  of  letters  and 
of  science.  You  are  entitled  to  welcome  not  alone  because 
of  these,  but  because  of  the  objects  and  the  purposes  that 
have  brought  you  together.  The  chief  end  of  government 
is  the  accomplishment  of  the  greatest  good  to  the  greatest 
number.  (Applause.)  Whether  that  great  evolution  of 
modern  trade  and  commerce  commonly  known  as  the  trust 
is  to  prove  of  benefit  or  injury  to  the  masses  of  our  people, 
and  if  of  benefit  how  it  may  be  safely  promoted,  and  if  of 
injury  what  the  remedy  shall  be,  how  and  by  what  au- 
thority applied,  are  questions  that  lie  close  to  the  well- 
being and  happiness  of  our  people,  and  in  which  they  are 
to-day  above  all  other  matters  vitally  interested.  (Ap- 
plause.) 


7 


TRUSTS — PRO  AND  CON. 


JUDGE  WILLIAM  WIRT  HOWE. 


Chairman  of  the  Conference. 


TRUSTS — PRO  AND  CON". 


9 


The  personnel  of  this  conference  is  guarantee  that  these 
great  questions  will  not  only  be  ably  discussed,  but  along 
educational,  conservative  lines,  which  are  the  underlying 
principles  of  this  conference,  and  it  is  because  of  the  cour- 
tesy ordinarily  due  to  strangers  within  our  gates,  and  is 
due  also  because  of  high  considerations  of  personal  regard  ; 
it  is  because  of  the  prominence  which  you  have  attained 
in  the  public  estimation;  it  is  because  of  the  purposes  and 
objects  that  have  brought  you  together;  and  it  is  because 
we  believe  that  as  a result  of  this  conference  our  people 
will  have  a better  and  a wider  knowledge  of  these  great 
questions,  and  that  here  will  be  sown  the  seed  which  shall 
blossom  into  legislation,  if  legislation  be  needed,  at  once 
wise  and  conservative,  having  in  view  alike  the  interests 
of  capital  and  of  labor,  of  the  consumer  and  the  pro- 
ducer. 

It  is  because  of  all  these  that  on  behalf  of  the  great 
state  of  Illinois  and  on  behalf  of  its  governor,  I extend  to 
you  a hearty  and  cordial  welcome. 


DR.  HOWARD  S.  TAYLOR. 

In  the  absence  of  Mayor  Harrison,  Dr.  Howard  S.  Tay- 
lor, city  prosecuting  attorney,  welcomed  the  delegates  on 
behalf  of  the  city.  He  spoke  as  follows: 

Mr.  President,  delegates  and  gentlemen:  I am  re- 
quested by  his  honor  the  mayor,  now  absent  from  the  city, 
to  be  present  on  this  occasion  and  in  his  name  to  bid  you 
a most  hearty  welcome  to  Chicago,  with  the  assurance  that 
this  great  city,  whose  motto  is  ^T  will,’^  shrinks  from  no 
problem,  but  with  the  characteristic  intelligence  and  lib- 
erality that  from  old  Fort  Dearborn  till  now  has  always 
distinguished  her  welcomes  into  her  forum  with  perfect 
confidence  every  free  utterance  and  inquiry  that  may  give 
inspiration  and  wisdom  to  the  great  republic  of  which  we 
are  a constituent  part.  Chicago,  through  all  her  history, 
believed  that  there  is  more  danger  in  suppressing  truth 
than  in  publishing  falsehood;  and,  therefore,  she  clings  to 
the  old  doctrine  of  free  and  full  speech  on  every  question 
of  public  interest. 


10 


TRUSTS — PRO  AND  CON. 


The  matter  that  has  brought  you  together  is  of  prime 
importance  to  Chicago  and  to  the  whole  country.  We 
are  a nation  of  wealth  producers  and  distributors.  We 
can  fight  if  need  be;  from  Washington  down  to  Miles, 
from  John  Paul  Jones  to  Admiral  Dewey,  we  have  no 
apologies  to  make  for  our  conduct  on  land  or  sea.  We 
have  also  contributed  our  full  quota  to  the  world’s  treasury 
of  literature  and  art;  but,  after  all,  Providence  and  the 
genius  of  our  people  have,  in  the  main,  led  us  in  the  ways 
of  peace  and  production.  To  challenge  Nature,  to  wring 
from  her  strongholds  the  material  gains  that  shall  make 
us  a people  of  happy  homes  and  hopeful  hearts,  has  been 
the  history  of  our  honorable  past  and  the  prophecy  of  our 
growing  future.  Whatever,  therefore,  touches  the  ques- 
tion of  wealtli  production  and  distribution  touches  the  cen- 
ter of  our  civilization  and  invites  from  all  our  people  such 
counsel  and  action  as  shall  secure  for  us  and  our  posterity 
the  greatest  possible  good — the  benevolent  reign  of  peace- 
ful industry  that  shall — 

^^Scatter  plenty  o’er  a smiling  land 
And  read  its  history  in  a nation’s  eyes.” 

That  the  subject  which  you  are  to  discuss  is  one  both 
of  eminence  and  imminence  is  proven  not  only  by  your 
presence  here,  but  by  the  wide  discussion  which  is  now 
going  on  in  the  magazines  and  newspapers  and  in  every 
other  place  where  public  opinion  is  created  or  expressed. 
Gentlemen  may  differ  in  their  opinions  concerning  the 
nature  of  trusts,  their  cause  and  cure;  but  there  is  no 
questioning  the  fact  that  a new  and  portentous  phenome- 
non has  risen  above  the  horizon  of  our  national  life,  and 
one  of  such  grave  import  as  to  justify  the  fullest,  fairest 
study  that  this  convention  can  command. 

His  Honor,  Mayor  Harrison,  has  his  views  upon  this 
subject — clear  and  pronounced;  but  he  entertains  them 
as  an  American  citizen  and  will  not  take  advantage  of  his 
official  position  to  promulgate  them.  As  chief  magistrate 
of  the  city  he  does  not  desire  to  bias  or  anticipate  your 
conclusions;  but,  confident  always  in  truth  as  an  end  and 
free  speech  as  a means,  he  approves  your  convention  and 
bids  you,  through  me,  a most  cordial  welcome  to  Chicago. 


TRUSTS — PRO  AND  CON. 


11 


PRES.  FRANKLIN  H.  HEAD. 

President  Head^  on  behalf  of  the  Civic  Federation,  out- 
lined the  objects  of  the  conference.  He  spoke  as  follows: 

The  Civic  Federation  of  Chicago  is  a nonpartisan  or- 
ganization, embracing  in  its  membership,  supporters  and 
well  wishers,  a goodly  portion  of  the  active  business  and 
professional  men  of  our  city — the  men  who  in  their  sev- 
eral ways  have  helped  to  win  for  our  city  its  position  as  a 
metropolitan  capital.  Some  "months  ago  it  realized  that 
no  topic  seemed  so  widely  discussed  as  what'  was  designated 
by  the  general  title  of  ^^Trusts,^^  and  that,  too,  upon  no 
current  topic  was  there  so  widespread  and  general  ignor- 
ance and  confusion  of  ideas.  There  seemed  to  us  a crying 
need  of  education  upon  the  subject,  of  an  education  which 
v/ould  show  the  broad  distinction  between  the  various  trade 
combinations  and  trusts,  and  to  promote  such  education 
this  conference  is  now  in  session. 

It  is  not  a trust  or  an  anti-trust  conference,  but  a con- 
ference in  search  of  truth  and  light.  With  this  end  in 
Anew  the  attendance  has  been  solicited  of  men  of  every 
shade  of  opinion  upon  the  general  subject;  the  men  tvho 
regard  trusts  and  trade  combinations  as  the  standing 
]nenace  of  our  national  prosperity,  and  even  to  the  per- 
petuity of  our  system  of  government,  and  those  who  feel 
that  trade  combinations  and  large  aggregations  of  active 
capital  are  simply  a natural  evolution  in  the  development 
of  our  industrial  and  commercial  life,  and  that  such  ag- 
gregations are  absolutely  necessary  to  enable  us  to  com- 
pete with  the  vast  accumulations  and  experience  of  the 
older  nations,  and  their  almost  total  control,  outside  of 
food  products,  of  the  markets  of  the  world. 

We  are  also  to  hear  from  those  holding  views  between 
either  extreme;  those  Avho  believe  in  the  value  of  combi- 
nations properly  organized,  but  who  recognize  in  the  reck- 
less and  excessive  capitalization  of  many  such  combina- 
tions a peril  leading  to  widespread  panic  and  distress  from 
such  inflated  source  of  the  profits.  It  is  a question  not 
yet  practically  settled,  and  a question  which  most  people 
have  not  yet  even  settled  in  their  own  minds  whether  it  is 
in  the  interest  of  the  public  that  by  high  charges  divi- 


12 


TEUSTS — PEO  AND  CON. 


dends  should  be  earned  on  capitalization  which  represents 
merely  a public  franchise^  or  on  that  which  represents  the 
monopolistic  element  created  simply  by  the  aggregation  of 
capital  without  the  application  of  special  talent  or  excep- 
tional skill. 

We  hope  to  hear  the  general  subject  discussed  from  all 
possible  standpoints — from  the  view  not  only  of  the  organ- 
izers of  the  combinations,  but  also  from  the  Avorkmen  and 
customers  of  the  industrial  corporations.  We  hope  light 
will  be  thrown  upon  the  difference  between  the  trusts 
Arhich  tend  to  monopolies  and  the  industrial  combinations 
Avhich  in  many  cases  seem  to  be  to  the  aclA^antage  of  all. 

We  are  now  in  a period  of  a large  advance  in  the  prices 
of  most  classes  of  manufactured  goods,  especially  iron  and 
steel  products,  and  Ave  hope  some  of  our  speakers  Avill 
illustrate  hoAV  much  of  this  adA^ance  is  due  to  combinations- 
and  hoAV  much  to  the  vastly  increased  demand,  Avhich  in 
all  lines  has,  always  in  the  past  resulted  in  advanced  prices 
under  the  immutable  law  of  supply  and  demand.  There 
has  been  no  trust  or  combination,  for  instance,  among  our 
farmers,  but  Ave  all  recollect  how,  tAvo  years  ago,  the  short 
Avheat  crop  abroad  caused  such  an  increased  demand  as  to 
advance  legitimately  the  price  of  that  staple  over  50  per 
cent  within  a period  of  four  months,  and  later  an  enormous 
demand  for  wheat  from  one  of  our  citizens,  Joseph  Leiter, 
Avhose  hunger  for  Avheat  gave  him  a Avorld-Avide  reputation, 
caused  an  advance  of  another  50  per  cent. 

The  very  general  response  to  our  invitations  to  this 
conference  from  the  governors  of  nearly  all  the  states,  avIio 
have  appointed  as  delegates  their  most  eminent  citizens, 
and  from  the  great  commercial  bodies,  the  uniA^ersities  and 
the  labor,  agricultural  and  other  organizations  Avhich  have 
sent  their  ablest  men  and  most  profound  students  of  eco- 
nomic problems — this  response  has  been  gratifying  be- 
yond measure,  and  illustrates  the  interest  eA^erywhere  felt 
in  the  general  subject  and  its  impartial  discussion.  This 
response  also  fills  us  Avith  ho])e  as  to  the  great  advantages 
Avhich  Avill  result  from  the  full  discussion  of  all  phases  of 
the  most  Antal  topic  of  the  day.  We  trust  that  this  dis- 
cussion may  be  able,  scholarly  and  dignified,  as  becomes  the 
subjects  and  the  occasion,  and  that  AAdien  these  discussions 


TRUSTS — PRO  AND  CON. 


13 


reach  their  proper  audience — the  millions  of  people  in 
every  town  and  hamlet^,  w^ho  from  the  newspapers  receive 
the  reports  of  your  deliberations — it  may  lead  to  action  that 
may  tend  to  preserve  in  onr  trade  combinations^  all  which 
is  of  valne^  as  well  as  to  point  out  methods  by  which  the 
evils  of  such  combinations  may  be  avoided. 

The  Civic  Federation  recognizes  that  with  the  assem- 
bling of  the  delegates  to  this  conference  and  its  brief  pre- 
liminary exercises  its  participation  in  your  proceedings  is  at 
an  end.  Yon  will,  gentlemen,  make  yonr  own  program  and 
plans.  At  the  same  time  I wish  to  tender  yon  on  the  part 
of  the  federation,  with  its  best  wishes,  the  services  of  any 
committees,  officers  or  members,  whenever  such  services 
can  in  any  way  facilitate  your  work. 


PROBLEMS  BEFORE  THE  CONFERENCE. 


OUTLINED  BY  PROFESSOR  J.  W.  JENKS  OF  CORNELL 
UNIVERSITY. 

Pending  the  selection  of  the  committee  on  program, 
which  was  to  be  reported  at  the  afternoon  session.  Presi- 
dent Head  introduced  Professor  J.  W.  Jenks  of  Cornell. 
He  spoke  as  follovcs: 

It  has  been  well  said  that  the  first  essential  for  the  at- 
tainment of  scientific  knowledge  is  to  get  a definite  out- 
line of  one^s  ignorance.  It  is  certainly  true  that  a long- 
step  has  been  taken  toward  the  solution  of  a problem  when 
the  problem  itself  has  been  clearly  stated.  It  may  be  of 
service,  therefore,  if  the  various  questions  which  the  pres- 
ent combinations  of  capital  have  raised,  and  toward  the 
solution  of  which  this  conference  may  well  contribute 
much,  be  brought  together.  I cannot  expect  to  state  clear- 
ly all  of  the  questions  raised  by  the  growth  of  these  in- 
dustrial combinations,  but  I mention  some  of  the  most  im- 
portant ones  as  they  have  been  called  to  my  attention. 

1.  Competition  versus  combination. 

It  has  often  been  assumed  that  industrial  combinations 
and  monopolies  have  abolished  competition.  On  the 


14 


TKUSTS — PRO  AND  CON. 


other  hand^  managers  of  the  most  important  industrial 
combinations  invariably  assert  that  they  have  much  com- 
petition, and  that  the  principle  of  competition  is  still 
active  as  long  as  any  one  is  legally  free  to  set  up  a rival 
establishment.  Many  students  of  the  question  have  as- 
serted that  among  great  industrial  organizations  compe- 
tition is  fiercer  than  among  smaller  establishments,  and 
that  combination  does  not  abolish  competition,  but  simply 
raises  it  to  a higher  plane.  So  long  as  there  is  not  a state 
monopoly  like  that  of  the  postoffice,  or  a legal  monopoly 
like  that  established  by  a patent,  there,  of  course,  is  at 
least  potential  competition.  A rival  may  at  least  enter 
the  lists.  But  a question  on  which  many  people  are  not 
yet  clear  is  how  far  large  combinations  of  capital  possess 
a monopoly  in  fact,  and  how  far  these  large  industrial  com- 
binations are  able  to  fix  prices  on  the  monopolistic  prin- 
ciple of  securing  the  highest  net  returns  with  little  refer- 
ence to  what  others  charge,  even  though  there  may  exist 
in  the  business  some  few  other,  but,  relatively  speaking, 
unimportant,  establishments.  How  far  can  an  establish- 
ment which  sells  only  a high  percentage,  say  75  to  90  per 
cent  of  the  total  product,  secure  monopolistic  gains?  Is 
competition  to  be  considered  free  when  one  establishment 
controls  from  75  to  90  per  cent  of  the  entire  product  in  the 
market? 

2.  Combinations  of  capital  and  combinations  of  labor. 

Some  of  the  most  active  opponents  to  organized  capital 

have  been  found  in  the  ranks  of  organized  labor.  Some 
of  the  managers  of  industrial  combinations  assert  that 
they  have  been  forced  to  combine  on  account  of  the  power 
of  organized  labor.  They  assert  that  the  principle  of  com- 
bination is  the  same  in  both  cases,  and  that  labor  organi- 
zations are  no  less  tyrannous  than  are  organizations  of 
capital.  Before  legislation  regarding  combinations  is  un- 
dertaken the  question  should  be  clearly  answered  whether 
the  two  classes  or  organizations  are  the  same  in  principle, 
and  whether  a law  which  restrains  one  will  be  held  by  the 
courts  to  restrain  the  other  also. 

3.  Combinations  caused  by  special  privileges. 

It  has  been  asserted  lately  that  the  ‘^‘^mother  of  all  trusts 
is  the  customs  tariff  law.’^  Many  industries,  however,  in 


TRUSTS — PRO  AND  CON. 


15 


which  great  combinations  exist,  have  no  protection  of  their 
products  by  the  tariff.  Managers  of  combinations  which 
have  been  formed  in  protected  industries  assert  that  it  has 
been  the  fierceness  of  home  competition  that  has  driven 
them  into  combination,  and  that  if  the  tariff  has  been  in 
any  sense  the  cause  of  the  combination  it  has  been  such 
oniy  by  developing  the  home  industry  to  so  great  an  extent 
that  fierce  competition  was  unavoidable.  How  large  a 
proportion  of  the  trusts  does  the  protective  tariff  favor? 
Would  a lowering  of  the  tariff  on  protected  industries  in 
which  industrial  combinations  have  been  formed,  destroy 
the  combination,  or  would  it  merely  lead  to  international 
combination  such  as  already  exists  at  least  in  one  or  two 
instances?  Or  would  it,  without  breaking  the  combina- 
tion, have  the  effect  of  lowering  prices  through  foreign 
competition? 

Other  combinations  of  great  power  have  been  formed  in 
industries  protected  by  patents,  and  have  secured  monopo- 
listic prices  through  the  aid  of  the  patent  laws.  Would  it 
be  in  the  interests  of  the  public  and  would  it  be  practi- 
cable so  to  amend  our  patent  laws  as  to  remove  from  them 
the  element  of  monopoly,  while  still  securing  to  the  in- 
ventor, by  royalty  or  otherwise,  according  to  different  sug- 
gestions, a suitable  reward  for  his  inventive  skill? 

It  has  been  frequently  asserted  that  the  success  of  many 
of  the  leading  combinations  of  capital  has  been  due  to 
special  favors  granted  them  by  discriminating  rates  on 
railroads.  It  is  also  asserted  by  some  that  the  most  suc- 
cessful combinations  of  the  present  day  find  it  rather  for 
their  interest  to  observe  strictly  the  interstate,  commerce 
law  and  to  insist  upon  it  that  the  railroads  shall  grant  no 
discriminations  to  anyone,  whereas  it  is  for  the  interests 
of  those  small  combinations  that  are  still  struggling  for  a 
firm  foothold  to  secure  such  discrimination.  It  is  believed 
by  many  people  that  railroad  discriminations  are  still  very 
frequent.  Most  important  questions  to  be  solved  are,  first, 
one  of  fact.  To  what  extent  and  to  whom  do  the  rail- 
roads grant  discriminating  rates?  And  second,  what  fur- 
ther remedy  can  be  found  for  such  discrimination  beyond 
that  which  now  exists  under  the  interstate  commerce  laws 
of  the  several  states? 


16 


TKUSTS — PKO  AND  CON. 


SOME  OTHEE  CAUSES. 

4.  Other  causes  for  the  formation  of  combinations  of 
capital. 

Managers  of  great  capitalistic  organizations  usually  as- 
sert that  they  have  been  driven  into  combination  through 
the  fierceness  of  competition;  that  without  combination 
fair  earnings  on  capital  could  not  be  realized^  and  that  the 
trusty  instead  of  being  an  aggressive  combination^  is  really 
capital  on  the  defensive.  They  also  assert  that  it  is  only 
through  the  potver  that  comes  from  a large  aggregation 
of  capital  that  we  are  able  to  meet  foreign  competition  in 
foreign  trade^  and  that  without  such  combination  our  ex- 
port trade  could  not  be  well  developed,  whereas  with  the 
development  of  foreign  trade  brought  about  through  the 
combination  of  capital  they  are  eliabled  to  increase  the 
output  that  the  demand  for  labor  and  the  profits  of  capi- 
tal are  both  greatly  increased.  How  far  are  these  as- 
sertions true? 

5.  Overcapitalization. 

Most  of  the  newer  combinations  of  capital  have  issued 
large  amounts  of  stock,  common  and  preferred,  as  well  as 
of  bonds.  It  is  important,  at  least-for  the  investor,  to 
know  the  facts:  How  much  of  this  capital  is  represented 
in  plant  at  a fair  valuation?  EIow  much  in  patents  or 
brands?  How  much  in  good  will  in  the  proper  sense  of 
that  word?  How  much  is  ^Vater?^^  It  is  asserted  by 
some  that  no  harm  is  done  the  public  even  though  the 
capitalization  be  much  beyond  the  value  of  the  plants;  that 
the  amount  of  capitalization  has  no  effect  on  prices. 
Others,  who  believe  that  in  these  combinations  an  element 
cf  monopoly  is  found,  think  that  an  attempt  to  pay  divi- 
dends on  a large  capitalization  does  increase  prices.  One 
class  of  persons  assert  that  capital  stock  should  be  limited 
to  the  amount  of  capital  actually  paid  in  in  cash  or  in 
plants  or  goods  taken  at  a conservative  valuation.  Another 
class  believes  that  capitalization  should  be  fixed  by  the 
probable  earning  capacity  of  an  establishment.  It  is  urged 
as  an  example  that  a newspaper  with  a plant  valued  at 
$100,000  may  well  earn  large  dividends  on  a million  owing 
to  the  genius  of  the  editor.  Why,  it  is  asked,  not  capital- 


TRUSTS — PRO  AND  CON. 


17 


ized  at  a million?  But,  on  the  other  hand,  should  we  put 
into  permanent  securities  a value  depending  on  the  power 
of  one  short-lived  individual?  Most  people  would  readily 
grant  that  genius  or  even  the  nerve  that  is  shown  in  in- 
vesting capital  in  new  enterprises  should  meet  with  a fitting 
reward;  but  is  it  best  to  put  the  reward  in  that  form? 

Again,  a street  railway  or  a gas  plant  which  costs  $500,- 
000  and  whose  franchise  has  been  given  it  may  pay  good 
profits  on  one  or  two  millions.  Is  it  in  the  public  interest 
that  a public  franchise  be  thus  capitalized,  put  into  se- 
curities in  private  hands  so  as  to  pay  dividends  on  one  or 
two  millions,  if  the  public  are  led  thereby  not  to  see  the 
capitalization  or  to  make  the  nature  of  capitalization  of 
each  organization  public,  so  that  any  investor  can  readily 
learn  how  large  a proportion  in  every  case  is  represented 
by  plant,  how  much  by  patents  or  special  brands,  how 
much  by  good  will  and  how  much  is  nothing  but 
^Vater^^?  Would  such  knowledge  adequately  protect  the 
investor?  Would  such  knowledge,  by  inviting  competition, 
if  real  profits  were  made  public,  sufficiently  protect  the 
consumer  by  making  monopolistic  prices  impossible?  Are 
the  interests  of  the  stockholders  and  the  interests  of  the 
consumers  under  present  industrial  conditions  the  same? 

6.  Effects  of  the  combinations — (A)  on  prices. 

It  remains  still  to  be  fully  established  as  to  what  the 
effect  of  these  combinations  are  upon  the  prices  of  raw 
material  and  of  the  finished  products.  Are  prices  of  raw 
materials  held  lower  than  its  normal  by  the  combination? 
Are  the  prices  of  the  finished  product  lowered  or  made 
higher  by  combination?  Is  it  possible  that  competition 
can  force  prices  so  low  that  by  forcing  into  bankruptcy 
large  numbers  of  establishments  the  interests  of  the  public 
will  be  seriously  injured?  And,  from  the  small  output, 
prices  even  be  put  at  length  above  combination  rates? 
Is  it  in  the  interests  of  the  laborers  and  the  public  at  large 
that  the  fiercest  competition  possible  in  prices  be  encour- 
aged? 

(B)  on  wages — Despite  the  fact  that  the  wage  earners 
them^selves  seem  to  be  largely  opposed  to  the  industrial 
combinations,  it  is  often  asserted  by  the  managers  of  the 
trust  that  they  have  increased  the  wages  of  the  laboring 


18 


TKUSTS — PRO  AND  CON. 


men.  Laborers  themselves  assert  that  these  combinations 
throw  many  men  out  of  employment.  They  believe  also 
that  combinations^  by  controlling  practically  all  of  the 
plants  of  any  one  industry^  are  in  much  better  condition 
to  resist  the  demands  of  labor  and  to  resist  any  pressure 
that  can  be  brought  upon  them  by  threats  of  strike.  A 
strike  in  one  or  two  or  several  establishments  will  not 
affect  the  combination  materially^  provided  it  can  carry  on 
production  in  the  other  establishments  at  the  same  time. 
The  question  is  not  yet  settled  whether  under  the  system 
of  combined  capital  the  laborers^  by  making  also  a thor- 
ough combination  covering  the  whole  of  any  one  indus- 
try^ may  not  be  even  better  able  to  deal  with  their  em- 
ployers than  they  are  at  the  present  time.  If  their  organi- 
zation covers  only  two  or  three  plants  they  appear  to  be 
at  a disadvantage.  If  their  organization  covers  the  entire 
industry,  can  the  laborers  and  capitalists  then  deal  as  a 
unit  in  fixing  wages  over  the  whole  territory?  Through 
their  agreements  on  wages  can  they  more  readily  control 
the  prices  to  consumers  than  has  ever  been  the  case  be- 
fore? The  effects  of  combinations  of  capital  at  the  pres- 
ent time  upon  both  the  rate  of  wages  and  the  continuity 
of  employment  need  to  be  established;  and  a fertile  guide 
for  not  merely  speculation  but  for  serious  thought  remains 
in  the  possibilities  for  the  future  of  such  an  extension  of 
labor  unions  that  the  employers  and  the  employes  through- 
out an  entire  industry  can,  with  little  fear  of  successful 
opposition  from  the  outside^  so  control  the  industry  that 
they  can  practically  fix  prices  arbitrarily.  The  effects  of 
such  a double  combination  upon  the  consuming  commu- 
liity  at  large  need  also  further  study. 

EFFECT  UPON  MIDDLEMEN. 

(C)  upon  middlemen — A third  complaint  against  great 
capitalistic  organizations  comes  from  the  middlemen,  par- 
ticularly from  jobbers  and  wholesale  dealers,  who  assert 
that  the  trusts  are  eliminating  men.  Is  this  elimination 
of  the  middlemen,  as  well  as  the  saving  of  labor,  to  be 
considered  on  the  whole  a gain  to  the  community  or  a 
loss?  If  the  trusts  can  deal  directly  with  two  or  three 
large  jobbers,  can  fix  their  prices  and  guarantee  their 


TKUSTS— PRO  AND  CON. 


19 


profits,  will  there  be  enough  saving  in  energy  to  the  com- 
munity to  make  up  for  the  loss  to  those  who  are  driven 
out  of  business  temporarily?  Will  it  also  be  possible  with- 
in a comparatively  short  time  for  those  persons  whose 
business  is  thus  ruined,  as  well  for  the  laborers  who  are 
driven  out  of  employment  by  the  combinations,  to  secure 
employment  elsewhere  through  the  added  demand  that 
may  come  from  the  saving  of  cost  and  of  labor  merely? 
In  other  words,  is  the  new  form  of  organization  a means 
of  saving  energy  comparable  with  a new  invention  like  the 
railroad  or  the  steam  engine,  so  that  we  may  be  fairly  sure 
that  though  temporary  suffering  occurs  there  will  be 
enough  saving  to  lower  prices  and  increase  the  demand  for 
goods  to  so  great  an  extent  that  the  total  demand  for  labor 
in  the  long  run  will  be  increased?  Or,  on  the  other  hand, 
is  the  new  form  of  organization  a conspiracy  of  the  few 
rich  and  powerful  to  oppose  the  many?  Each  view  is 
taken  by  thousands. 

7.  Legislation — If  the  state  needs  to  interfere  in  this 
modern  industrial  movement,  what  form  of  legislation  is 
wisest?  Should  it  be  destructive  and  attempt  to  prevent 
combination,  or  should  it  be  regulative,  permitting  com- 
bination freely,  but  attempting  so  to  control  that  evils  to 
the  public  may  be  avoided?  Of  legislation  aiming  at  de- 
struction we  have  had  many  examples.  The  question  still 
remains  unsettled  as  to  how  far  this  legislation  will  prove 
effective.  .Many  points  have  been  overruled  by  the  courts; 
many  have  been  upheld;  experience  only  will  show  the  out- 
come there. 

If  legislation  is  to  be  chiefly  regulative,  will  it  be  suffi- 
cient to  secure  publicity,  or  can  something  be  done  to  pre- 
vent undue  raising  of  prices?  A second  question  of  not 
less  import  is  this:  How  far  can  such  legislation  be 
national  under  the  general  provisions  of  our  constitution 
regarding  interstate  commerce,  and  how  far  must  the  leg- 
islation be  state?  Could  there  be  within  a reasonable  time 
national  incorporation  of  great  industries  over  which  the 
federal  government  should  have  sole  control?  If  so, 
would  such  control  be  advisable?  Can  congress  now,  un- 
der our  present  constitution,  secure  full  information  for 
public  use  regarding  the  nature  of  the  property  and  busi- 


30 


TRUSTS — PRO  AND  CON. 


ness  of  great  corporations,  and  with  frequent  reports  re- 
garding the  condition  of  the  business,  could  it  so  inspect 
the  books  and  records  of  such  organization  that  public 
confidence  in  reports  would  be  assured?  If  such  publicity 
were  sought  through  government  would  a special  commis- 
sion or  bureau  be  needed  for  the  administrative  work? 
Can  any  of  the  states,  by  any  measures,  effectively  promote 
the  interests  of  their  citizens  without  laws  that  are  sub- 
stantially uniform  among  them  all? 

There  are  other  problems  suggested  by  the  industrial 
combination.  I have  mentioned  the  most  important  ones 
to  which  my  attention  has  been  called.  It  is  hoped  that 
wise  and  conservative  though  bold  action  may  in  no  long 
time  solve  some  of  them. 

The  conference  then  adjourned  until  the  afternoon. 


TRUST  PROBLEMS. 


PROFESSOR  HENRY  CARTER  ADAMS. 

Professor  Henry  Carter  Adams,  of  the  University  of 
Michigan,  addressed  the  conference  in  the  afternoon  of 
the  first  day  on  ^^Trust  Problems,^^  as  follows: 

I have  been  requested  to  undertake  a statement  of  the 
questions  that  arise  in  the  consideration  of  the  trust 
problem.  In  doing  this  I can  say  nothing  that  is  new, 
nor  shall  it  be  my  aim  to  be  exhaustive.  It  is  possible, 
however,  that  questions  which  are  familiar  may  present 
themselves  in  a new  light  when  brought  together  in  a 
single  statement. 

Whatever  the  trust  problem  may  be,  it  has  to  do  with 
business  organization,  and  on  this  account  the  first  ques- 
tion that  suggests  itself  is  one  that  pertains  to  the  science 
of  economics.  We  observe  in  almost  every  form  of  busi- 
ness that  industrial  power  is  concentrating  itself,  that 
organizations  are  growing  in  size,  that  individual  and 
small  enterq)rises  are  being  crowded  to  the  wall,  and  that 
the  sphere  of  competition  is  constantly  being  narrowed. 


TKUSTS — PBO  AND  CON. 


21 


This  tendency  is  opposed  to  the  theory  upon  which  our 
system  of  jurisprudence  rests^  and  it  is  pertinent  to  in- 
quire whether  it  is  inherent  in  the  nature  of  the  industries 
that  are  thus  tending  toward  consolidation^  or  whether 
its  explanation  is  to  be  found  in  the  peculiar  conditions 
under  which  industry  at  the  present  time  is  carried  on. 
This  is  a most  important  question^  for  if  the  tendency  to- 
ward consolidation  be  natural^  remedial  legislation  should 
address  itself  to  the  control  of  the  industrial  forces  thus 
brought  together.  If^  on  the  other  hand^  this  tendency 
be  artificial^  the  legislature,  in  dealing  with  the  situation, 
must  seek  to  restore  those  conditions  under  which  indi- 
vidual enterprise  may  be  able  to  maintain  itself.  Without 
undertaking  the  analysis  of  industrial  conditions  and  mo- 
tives which  a consideration  of  this  question  involves,  I 
shall  state  at  once  what  seems  to  be  the  correct  opinion 
upon  this  subject.  Industries  are  not  all  of  the  same  kind. 
They  do  not  all  possess  the  same  character.  Some  tend 
toward  consolidation  and  combination,  while  others  are 
well  fitted  by  their  character  to  continue  a separate  and 
competitive  existence.  The  transportation  industries  are 
of  the  former  class.  The  manufacturing  industries  are, 
speaking  generally  of  the  latter  class. 

Eailways  by  their  very  nature  tend  toward  combina- 
tions and  consolidation.  The  biscuit  industry,  the  man- 
ufacture of  nails^  the  refining  of  oil,  on  the  other  hand, 
are  well  fitted  for  individual  management  and  administra- 
tion. If  these  latter,  like  the  former,  show  a tendency  to- 
ward consolidation,  the  explanation  will  be  found  in  the 
peculiar  conditions  under  which  they  are  carried  on.  Thus 
again,  upon  the  threshold  of  this  discussion,  do  we  dis- 
cover the  imperative  necessity  of  industrial  analysis  as  a 
guide  to  right  policy  and  sound  legislation.  Before  com- 
ing to  the  question  of  general  policy  there  is  another  ques- 
tion which  will  undoubtedly  be  made  the  subject  of  warm 
discussion  by  the  convention.  Are  the  combinations  com- 
monly called  trusts  advantageous  or  disadvantageous?  Is 
the  tendency  toward  consolidation  one  to  be  approved  or 
disapproved?  It  is  likely  that  this  discussion  will  turn 
upon  three  points:  First,  does  consolidation  of  manu- 
facturing industries  tend  toward  the  reduction  of  cost? 


TRUSTS — PRO  AND  OON. 


22 


Second,  will  manufacturing  under  trusts,  by  measuring 
the  output  to  the  current  demand,  tend  to  guard  society 
from  the  evils  of  commercial  panics  and  commercial  de- 
pressions? And  lastly,  is  this  new  organization  of  in- 
dustry in  harmony  with  a democratic  organization  of  so- 
ciety? Here  again  I must  ask  the  privilege  of  expressing 
an  opinion,  as  the  time  allotted  this  paper  does  not  permit 
a full  statement  of  the  reasons  upon  which  my  opinion 
rests 

PRODUCT  IS  CHEAPENED. 

It  is  common  to  say  that  increase  in  the  size  of  a 
manufacturing  plant  permits  the  production  of  commodi- 
ties at  less  cost  than  would  otherwise  be  the  case.  There 
is  undoubtedly  some  truth  in  this  statement.  The  de- 
velopment of  machinery  has  gone  hand  in  hand  with  the 
groAvth  of  factories,  and  as  a result  the  product  is  furnished 
at  a cheapened  rate.  But  there  is  a limit  to  the  applica- 
tion of  this  rule.  Every  manufacturing  industry,  con- 
sidered from  the  point  of  view  of  production,  has  at  any 
particular  time  a size  which  may  be  regarded  as  its  nor- 
mal size  of  maximum  efficiency.  This  normal  of  maxi- 
mum efficiency  is  determined  by  the  extent  to  which  di- 
vision of  labor  and  the  use  of  machinery  can  be  ap- 
plied. To  increase  such  an  industry  by  one-half  would 
not  result  in  a decrease  of  the  cost  of  manufacture,  for  it 
would  occasion  a less  effective  application  of  the  principle 
of  division  of  labor. 

While,  therefore^  it  is  true  that  the  concentration  of 
capital  and  labpr  under  a single  direction  is  followed  by 
economy  up  to  a certain  point,  it  is  not  true  that  com- 
bination and  concentration  beyond  that  point  tend  to  re- 
duce the  cost  of  the  production.  He  who  accepts  this 
statement  of  the  case  must  conclude  that  manufacturing 
combinations,  I say  nothing  of  other  forms,  contribute 
nothing  to  the  reduction  of  the  cost  of  manufacture  be- 
yond what  wmuld  be  contributed  should  each  of  the  in- 
dustries continue  its  independent  competitive  existence. 
This  is  a curt  answer  to  a profound  question,  but  it  is 
believed  to  rest  upon  sound  analysis  and  to  lead  to  the 
conclusion  that  the  motive  to  a trust  organization  of 


TRUSTS — PRO  AND  CON. 


23 


mamifacturing  industries  is  not  found  in  a desire  to  bene- 
fit the  public  by  the  reduction  of  cost. 

It  is  not  so  difficult  to  suggest  the  line  of  reasoning 
upon  the  second  question  submitted.  The  chief  argument 
in  favor  of  combination  among  producers  is  that  by  this 
means  production  will  be  measured  to  demand,  and  con- 
sequently there  will  be  no  overstocking  of  the  market,  no 
commercial  depression  and  no  commercial  panics.  I 
shall  not  undertake  to  argue  this  proposition,  but  content 
myself  with  a single  comment.  Opposed  to  this  theory 
of  commercial  depressions  stands  the  well-wrought  theory 
of  socialistic  writers  which  rests  upon  the  claim  that  a 
stocked  market  is  due  to  an  uneconomic  distribution  of 
values,  and  not  to  an  overproduction  of  goods.  It  cer- 
tainly is  true  that  goods  cannot  be  sold  when  the  property 
in  the  goods,  as  also  money  with  which  to  purchase  them, 
is  in  the  same  hands.  A steady  market  implies  an  equa- 
tion between  goods  on  the  one  hand  and  the  purchasing 
power  in  the  hands  of  those  for  whom  the  goods  are  made 
on  the  other.  You  perceive  at  once  the  bearing  of  this 
line  of  reasoning  upon  the  claim  that  combinations  tend 
to  steadiness  of  trade.  An  adjustment  of  the  output  to  the 
current  effective  demand  is  of  the  utmost  importance.  It 
may  be  questioned,  however,  whether  a yet  further  con- 
centration of  industrial  power  than  that  which  now  exists 
is  the  best  means  of  attaining  this  result. 

BALANCE  OF  POWEE. 

In  addition  to  these  purely  industrial  considerations 
it  is  necessary  to  inquire  respecting  the  general  social  and 
political  results  of  trust  organizations  before  one  can  ac- 
cept them  as  a healthful  tendency  in  modern  life.  It 
must  be  remembered  that  our  industrial  society  rests 
upon  English  jurisprudence,  that  English  jurisprudence 
acknowledges  the  individual  as  the  center  of  all  industrial 
activity,  that  it  provides  for  him  the  institution  of  private 
property,  holds  him  to  strict  accountability  and  assumes 
that  competition  between  producers  on  the  one  hand  and 
purchasers  on  the  other  hand,  is  a guaranty  of  justice  and 
equity  in  all  individual  conduct.  Do  trusts  fit  naturally 
into  this  theory  of  society?  For  the  preservation  of 


24 


TEUSTS — PRO  AND  CON. 


democracy  there  must  be  maintained  a fair  degree  of  equal- 
ity in  the  social  standing  of  citizens.  Do  trusts  tend  to 
such  equality?  For  the  normal  workings  of  that  indus- 
trial society  which  is  the  product  of  six  centuries  of  his- 
tory^ the  door  of  opportunity  must  not  be  closed.  Do 
trusts  tend  to  close  the  door  of  opportunity?  For  the 
realization  of  the  American  idea  of  government  there  must 
be  a balance  of  power,  and  the  interests  that  lie  outside 
the  government;  on  the  other  hand,  do  trusts  tend  to 
destroy  this  balance  of  power?  I would  not  claim,  with- 
out discussion,  that  the  trust  organization  of  society  de- 
stroys reasonable  equality,  closes  the  door  of  industrial 
opportunity,  or  tends  to  disarrange  that  fine  balance  es- 
sential to  the  successful  workings  of  an  autom^atic  so- 
ciety; but  I do  assert  that  the  questions  here  presented 
are  debatable  questions  and  that  the  burden  of  proof  lies 
with  the  advocates  of  this  new  form  of  business  organiza- 
tion. 

If  the  current  tendency  toward  consolidation  in  manu- 
facturing industries  does  not  spring  from  the  nature  of  the 
industry,  and  if  the  benefits  accruing  to  the  public  from 
these  consolidations  are  at  least  questionable,  it  is  incum- 
bent upon  us  next  to  inquire  out  of  what  conditions  these 
modern  industrial  organizations  have  sprung.  I shall 
venture  but  three  suggestions  in  this  connection.  Doubt- 
less many  more  will  be  presented  as  this  convention  pro- 
ceeds in  its  deliberations. 

The  inequalities  v/hich  exist  in  established  schedules  of 
railway  rates,  as  also  the  proneness  of  railways  to  depart 
from  published  schedules  in  order  to  secure  the  business 
of  large  shippers,  works  toward  the  consolidation  of  manu- 
facturing industries  and  commercial  enterprises.  It  is  not 
intended  to  say  that  maladministration  on  the  part  of 
railways  is  of  itself  responsible  for  present  industrial  ten- 
dencies. It  is,  however,  true  that  in  so  far  as  railways 
discriminate  in  favor  of  large  shippers  they  present  a mo- 
tive to  shippers  to  become  as  large  as  possible.  This  is 
too  familiar  a fact  to  call  for  discussion.  The  truth  is 
that  the  business  of  transportation  underlies  all  other  busi- 
nesses; it  determines  the  conditions  upon  which  other 
forms  of  industry  are  carried  on,  and  by  the  manipulation 


TRUSTS — PRO  AND  COK^. 


35 


of  rate  schedules  tone^  color  and  character  can  be  given 
to  industrial  society  at  large.  While  the  solution  of  the 
railway  problem  would  not  necessarily  cause  all  trusts  and 
combinations  to  disappear^  its  solution  is  essential  for  deal- 
ing wisely  with  the  trust  problem.  No  one  can  deny  that 
inequitable  railway  charges  and  discriminations  in  railway 
rates  are  an  important  element  in  the  conditions  that 
foster  commercial  combinations. 

In  further  explanation  of  the  current  tendency  toward 
business  combination  on  the  part  of  industries  that  by 
their  nature  are  not  monopolistic,  reference  may  be  made 
to  the  fact  that  the  commercial  jurisdiction  of  modern 
business  is  much  broader  than  the  political  jurisdiction  of 
the  governments  whose  protection  they  seek  and  by  whom 
they  should  be  controlled.  The  federal  government  has 
no  authority  over  many  of  the  questions  raised  by  the  study 
of  trusts,  while  the  state  governments  are  confined  in  the 
exercise  of  their  authority  to  their  local  jurisdictions. 

WOULD  CAUSE  CONFUSION. 

Such  a condition  must  result  in  confusion  of  laws,  in 
uncertainty  of  procedure  and  in  enabling  the  interstate 
enterprises  which  rest  upon  state  foundations  to  become  a 
law  unto  themselves,  so  far  as  the  conduct  of  their  affairs 
is  concerned.  Competition  cannot  work  inequitably  under 
such  conditions.  Justice  attends  competition  only  when 
competitors  stand  on  an  equal  footing.  It  is,  therefore, 
no  occasion  for  surprise  to  one  who  is  familiar  with  the 
present  condition  of  state  laws  upon  industrial  affairs  that 
small  and  localized  industries  should  find  themselves  at  a 
disadvantage  in  their  struggle  for  existence  with  the  great 
combinations.  A national  market  has  taken  the  place  of 
the  local  market,  but  we  still  rely  upon  local  law  for  its 
regulation  and  control.  Uncertainty  of  law  and  harmony 
of  procedure  are  as  essential  as  uniform  railway  rates  and 
absence  of  discrimination  to  restore  those  conditions  in 
which  competition  can  effect  its  normal,  beneficent  results. 

We  come  from  a state  whose  area,  resources,  and  popu- 
tion  of  economic  relations  to  the  stupendous  question  of 
political  organization  and  legislative  procedure.  He  who 
believes  in  local  government  will  not  readily  consent  to 


26 


TEUSTS — PEO  AND  CON. 


the  proposition  that  the  federal  congress  should  assert  ex- 
clusive authority  over  commercial  and  industrial  condi- 
tions. Nor^  on  the  other  hand^  will  he  who  appreciates  the'^ 
significance  and  the  beneficent  results  of  a world^s  market 
consent  to  the  suggestion  that  the  business  transactions  of 
a state  concern  should  not  extend  beyond  the  borders  of  a 
state.  Here  is  a problem  for  statesmen  to  contemplate, 
and  it  is  possible  before  arriving  at  its  solution  that  the 
constitutional  relations  between  the  local  and  the  federal 
government  will  be  subjected  to  modification.  Without 
entering  upon  this  phase  of  the  subject,  may  I submit  for 
consideration  the  following  proposition:  The  true  func- 
tion of  a central  government  in  dealing  with  problems  of 
internal  economy  is  to  determine  the  fundamental  princi- 
ples of  legislation,  while  the  true  function  of  local  gov- 
ernment is  to  express  those  principles  in  the  terms  of 
local  conditions  and  to  administer  the  laws  thus  expressed. 
By  this  means  harmony  of  action,  at  least,  would  be  se- 
cured, and  one  of  the  conditions  out  of  which  industrial 
combinations  spring  will  have  been  set  aside. 

My  third  suggestion  in  explanation  of  the  persistence 
of  combinations  in  industries  which  from  their  nature  are 
subject  to  competition  is  found  in  the  unsatisfactory  con- 
dition of  state  laws  of  incorporation.  This  is  a question 
that  should  be  considered  by  a lawyer,  but  by  the  law)"er 
who  is  familiar  with  the  industrial  history  of  the  English- 
speaking  people.  Originally  a corporation  created  by  the 
state  was  regarded  as  an  arm  of  the  state.  Individuals 
were  clothed  with  some  degree  of  public  authority  because 
they  undertook  to  perform  what  were  regarded  as  public 
duties.  The  East  India  Compan}^  which  planted  an  em- 
lure,  is  an  illustration  of  such  a corporation. 


TRUST  QUESTIONS  AS  TEXAS  SEES  IT. 


DUDLEY  WOOTEN. 

Following  Dr.  Adams,  Dudley  Wooten,  of  Texas,  was 
introduced  and  spoke  as  follows: 

We  come  from  a State  whose  area,  resources,  and  popu- 


TRUSTS — PRO  AND  CON. 


27 


lation^  we  think,  entitle  us  to  entertain  positive  and 
pertinent  convictions  upon  the  great  question  that  called 
together  this  meeting. 

First  of  all,  we  are  mainly  producers  of  raw  material 
and  consumers  of  manufactured  products,  and  whatso- 
ever tends  to  arbitrarily  control  the  prices  of  the  one 
or  to  monopolize  the  output  of  the  other  is  a direct  in- 
jury to  our  people  and  their  industrial  pursuits.  In  the 
next  place  we  believe  that  there  is  a fundamental 
principle  of  political  ethics  and  governmental  science 
involved  in  the  problem  under  consideration.  We  believe 
that  there  are  some  things  more  valuable  to  a free  peo- 
ple than  the  mere  accumulation  of  worldly  wealth.  We  do 
not  believe  in  that  school  of  political  philosophy  that  re- 
jects as  antiquated  and  inadequate  the  great  precepts  and 
principles  of  a venerable  jurisprudence  at  the  behest  of 
modern  monopoly  that  salves  the  wounds  of  freedom 
with  the  oil  of  avarice,  and  condones  a constitutional 
crime  with  the  argument  of  pelf  and  greed. 

WORSE  THAI^  NEGRO  SLAVERY. 

After  citing  the  declaration  in  the  Texas  constitution 
that  ^^monopolies  are  contrary  to  the  genius  of  a free 
government  and  shall  never  be  allowed/^  he  continued: 

We  confidently  assert  that  the  commercial  and  indus- 
trial bondage  being  rapidly  imposed  upon  the  toil  and 
talents  of  70,000,000  of  American  citizens  by  the  syndi- 
cated wealth  of  a few  great  corporate  monopolies  is  more 
dire  and  dangerous  than  the  slavery  that  once  bowed 
the  heads  and  burdened  the  backs  of  4,000,000  of  South- 
ern black  men. 

Coming  to  this  Western  world,  we  remember  the  for- 
titude and  sagacity  that  founded  this  republic  on  the 
same  great  traditions  of  constitutional  right  that  have 
glorified  the  centuries  of  English  growth,  but  framed  its 
institutions  on  yet  freer  and  broader  lines. 

VIOLATE  NATION^S  TRADITIONS. 

Here  the  speaker  quoted  utterances  of  Washington,  Jef- 
ferson, the  elder  Adams,  and  Webster,  calling  attention 


28 


TRUSTS — PRO  AND  CON. 


THE  TRUST  OCTOPUS— ‘T  CAN  SEE  MY  FINISH." 


—From  The  Chicago  Record. 


TRUSTS PRO  AND  CON. 


29 


to  the  dangers  of  commercial  greed  and  privileged  mon- 
opolies^ then  said: 

Eemembering  and  revering  these  ancient  and  approved 
principles  and  precepts,  we  must  be  allowed  to  believe 
and  to  maintain  that  the  modern  ‘^^trusE^  and  its  more 
modern  successor — the  consolidated  corporate  monopoly — 
are  the  practical  realization  of  the  commercial  spirit  in 
its  most  odious  and  despotic  form. 

Developing  under  the  frown  of  judicial  disfavor,  the 
original  ^^trusts’^  have  passed  from  the  loose  and  imper- 
fect combinations  of  affiliated  corporations  into  the  crys- 
tallized and  condensed  union  of  huge  capitalized  monopo- 
lies under  one  charter  and  a centralized  control.  Their 
fundamental  purposes  are  to  reduce  the  cost  of  produc- 
tion to  the  manufacturers  by  minimizing  the  cost  of  labor 
and  (Jepressing  the  prices  of  raw  materials;  to  destroy 
competition  by  absorbing  all  rival  industries,  squeezing 
out  the  small,  coercing  the  weak,  and  amalgamating  the 
strong;  to  monopolize  and  control  trade  and  industry  by 
absolutely  dominating  the  markets  and  subsidizing  or  ter- 
rorizing the  free  and  normal  course  of  commerce  and  labor. 

They  seek  to  justify  their  operations  on  the  plausible 
ground  that  they  improve  the  quality  and  increase  the 
quantity  of  useful  manufactures,  reduce  prices  to  the  con- 
sumer, and  add  to  the  wealth  and  prosperity  of  the  coun- 
try. It  might  be  admitted  for  the  sake  of  argument 
that  some  of  these  contentions  are  temporarily  true,  but 
ultimately  none  of  them  is  true  or  possible  in  the  nature 
of  things. 

COUNTS  THE  COST. 

But  suppose  some  of  these  things  to  be  correctly  stated. 
At  what  and  whose  expense  are  these  much  praised  re- 
sults attained?  At  the  expense  of  the  producer  of  the 
raw  materials,  whose  products  are  sacrificed  at  ruinous 
prices;  at  the  expense  of  discharged  employes,  whose  places 
are  filled  by  fewer  hands  or  improved  machinery,  whose 
families  must  starve  or  steal  or  join  the  army  of  tramps; 
at  the  expense  of  every  honest  competitor  who  is  driven 
out  of  business  by  the  combination  or  closed  up  by  forci- 
ble absorption;  at  the  expense  of  every  customer  who  is 


30 


TRUSTS — PRO  AND  CON. 


compelled  to  handle  the  trust  goods  upon  arbitrary  terms 
and  at  such  profits  as  may  be  prescribed  by  the  trust; 
at  the  expense  of  the  entire  public. 

SUGGESTS  A EEMEDY. 

Entertaining,  as  we  do,  these  deliberate  convictions,  there 
is,  in  our  view  of  the  matter,  but  one  phase  of  the  prob- 
lem left  open  for  practical  discussion,  and  that  is  how 
best  to  remedy  the  evil  and  remove  its  causes.  ^ And  here 
again  we  are  confronted  with  a fundamental  question  of 
political  and  governmental  science.  It  has  been  said 
that  this  is  not  a political  question. 

The  courts  of  the  country  have  uniformly  and  correctly 
declared  that  but  for  the  existence  and  operations  of  pri- 
vate corporations,  trusts  and  monopolies  could  not  subsist 
for  an  hour.  It  is  only  by  the  corporation,  with  its  pe- 
culiar and  artificial  attributes,  that  trusts  and  trade  com- 
binations can  be  successfully  carried  out.  Here,  then, 
we  have  the  root  of  the  evil,  in  the  private  corporation. 

Corporations  in  some  form  or  other  are  no  doubt  in- 
dispensable in  a limited  degree  to  the  efficient  and  suc- 
cessful management  of  many  enterprises.  But  nowhere 
and  at  no  time  have  they  existed  in  such  numbers,  for 
such  purposes,  and  under  such  conditions  as  attend  them 
in  this  republic.  The  government  has  further  enhanced 
their  power  and  privileges  by  the  most  unexampled  favor- 
itism and  public  protection. 

SEES  CAUSE  IN  TAKIFF. 

The  tariff  has  enabled  the  corporate  enterprises  and 
syndicates  to  establish  and  solidify  their  tyranny  over 
the  country,  and  by  legalized  plunder  to  amass  such  im- 
mense capital  as  to  dominate  the  whole  field  of  com- 
mercial and  industrial  activity.  After  nearly  forty  years 
of  its  unjust  and  unequal  rapacity,  it  now  hides  itself 
behind  the  trusts  and  monopolies  of  th^  land  as  behind 
the  breastwork  its  own  iniquities  have  erected.  It  is 
perhaps  not  desirable  and  is  practically  impossible  to  de- 
stroy this  vast  and  dangerous  class  of  artificial  citizenship 
in  the  shape  of  private  corporations,  but  it  is  assuredly 
not  only  desirable  but  absolutely  necessary  to  reduce  them 


TRUSTS — PRO  AND  CON. 


31 


to  something  like  equality  before  the  law  of  the  individual 
and  natural  citizenship  of  the  union. 

Under  our  institutions  these  artificial  persons  or  citi- 
zens are  created  by  the  states  and  not  by  the  federal 
government.  Therefore^  the  initiative  must  be  taken  by 
the  states^  and  to  accomplish  any  permanent  or  practical 
results  there  must  be  harmony  and  uniformity  of  action. 

PKOPOSES  LEGISLATION. 

The  speaker  then  referred  to  the  fact  that  the  federal 
government  has  control  over  interstate  commerce  as  em- 
phasizing the  need  for  united  action,  and  said: 

If  we  are  asked  along  what  lines  this  universal  and 
uniform  legislation  shall  be  framed,  then  we  unhesitat- 
ingly answer  that  it  should  be  in  the  direction  of  limit- 
ing the  purpose  for  which  private  corporations  shall  be 
chartered,  so  as  to  reduce  their  number,  and  by  limiting 
also  the  amount  of  capital  stock  for  which  a company 
may  be  incorporated,  so  as  to  curtail  their  enormous  power 
to  amass  undue  wealth  and  exercise  despotic  control  over 
the  commerce,  industry,  and  policies  of  the  nation. 

But  the  burden  of  this  great  work  cannot  and  ought 
not  to  be  thrown  entirely  upon  the  states.  We  believe 
that  the  federal  government  both  can  and  should  assume 
the  initiative  in  the  movement  to  suppress  and  restrain 
these  great  corporate  monopolies.  The  methods  suggested 
may  appear  radical  and  revolutionary  to  some,  but  the 
time  has  come  when  the  country  must  face  the  crisis  and 
solve  it  conscientiously,  courageously,  and  completely,  un- 
less we  are  to  surrender  those  principles  for  which  the 
union  was  formed  and  without  which  it  is  not  worth 
preserving.  If  government  of  the  people,  by  the  people, 
and  for  the  people  is  to  continue  in  this  republic,  then 
we  must  place  national  righteousness  above  national  wealth, 
ethics  above  economics,  political  principle  above  pecu- 
niary profit,  the  constitution  above  the  commerce  of  the 
country.  To  do  these  things  requires  a courage  and  con- 
stancy never  before  demanded  by  any  crisis  that  has  risen 
in  the  history  of  the  nation. 

Texas  will  make  good  her  right  to  wear  the  heritage 


32 


TRUSTS — PRO  AND  CON. 


of  her  illustrious  past^  and  will  he  found  standing  by  the 
side  of  all  the  states  in  the  endeavor  to  rescue  the  labor 
and  enterprise  and  freedom  of  our  whole  country  from 
the  paralytic  grasp  of  monopoly  and  greed. 


THE  NEW  COMBINATIONS  DAN- 
CrEROUS? 


JOHN  GRAHAM  BROOKS. 

Professor  John  Graham  Brooks,  lecturer  on  social  eco- 
nomics, University  of  Chicago,  followed  Mr.  Wooten  upon 
the  platform.  He  said: 

It  is  our  misfortune  that  no  opinion  upon  the  so-called 
trust  has  at  present  much  value.  The  movement  is  too 
new.  It  is  too  vast.  It  is  too  undeveloped. 

The  instinct  toward  still  vaster  and  more  compact  or- 
ganization is  everywhere  asserting  itself,  and  men  are 
Irightened,  as  they  were  a century  ago  by  the  movement 
toward  corporations.  Are  these  signs  that  the  monster 
is  dangerous  to  the  commonwealth?  It  would  be  simple- 
minded  to  answer  by  an  unqualified  yes  or  no.  We  do 
not  say  a corporation  is  good  or  bad  until  we  know  what 
the  corporation  is  or  does.  If  the  business  is  properly 
safeguarded  the  corporation  renders  a social  service  as 
essential  as  the  college.  The  supreme  question  that  con- 
fronts us  is  that  of  possible  regulation. 

This  discussion,  if  it  is  to  help  us,  has  to  assume  one 
momentous  fact — viz.;  the  pitiful  lack  of  anything  like 
adequate  organization  over  large  areas  of  industrial  life. 
Great  primary  industries — coal  and  clothing,  for  instance 
— are  in  a state  so  chaotic  as  to  affront  our  intelligence. 
The  extreme  clumsiness  of  organization,  both  in  produc- 
tion and  distribution^  has  thus  far  had  no  reaching  inves- 
tigation. One  gets  a hint  of  it  when  one  sees  at  a single 
hotel  in  a small  city  five  drummers  competing  against 
each  other  in  selling  the  same  product. 

Mr.  Brooks  referred,  in  this  connection,  to  the  criti- 


TRUSTS — PRO  AND  CON. 


33 


cism  of  the  chairman  of  the  Interstate  Commerce  commis- 
sion on  the  management  of  railways^,  and  used  his  own 
language  in  support  of  the  charge  that  the  great  inter- 
ests of  the  country  were  being  constantly  demoralized  by 
reckless  and  improvident  handling.  He  also  quoted  the 
language  of  a prominent  insurance  man  to  show  the  con- 
dition to  which  unregulated  competition  has  brought  the 
insurance  business.  Continuing^  Mr.  Brooks  said: 

LACK  OF  METHOD  IN  GEEAT  INDUSTEIES. 

As  many  different  milk  concerns  as  there  are  houses 
have  come^  at  the  same  time,  to  the  avenue  in  which  I 
live.  This  has  long  been  the  stock  illustration  of  crude 
and  preposterous  lack  of  method,  but  the  slightest  study 
in  detail  shows  that  scores  of  our  great  industries  have 
crudities  almost  grotesque.  To  the  extent  that  these 
charges  are  true  I submit  that  the  time  is  at  hand  for 
some  kind  of  wide,  thorough,  and  effective  organization. 

The  so-called  trusts  cannot  be  stopped.  I believe  it  to 
be  the  beginning  of  practical  sense  to  understand  that 
the  new  combinations  can  in  no  sense  be  permanently 
smashed.  The  party  which  proposes  to  do  this,  in  the 
sense  of  absolutely  checking  them,  will  have  plenty  of  leis- 
ure to  regret  it. 

The  real  problem,  immediate  and  imperious,  is  how  to 
regulate  and  guide  the  new  force  that  stands  merely  for 
the  latest  stage  of  industrial  growth.  If  the  combinations 
are  to  work  for  public  as  well  as  for  private  good,  three 
things  must  be  brought  about:  Absolute  publicity  of 
methods  and  accounts;  every  artificial  advantage  given 
by  the  tariff  must  be  removed;  and  railroad  discrimina- 
tions shall  not  be  allowed  to  these  combinations. 

There  is  probably  no  difficulty  more  desperate  than 
preventing  discrimination.  No  one  but  a Socialist  can 
solve  it  with  gay  and  final  confidence.  But  whatever 
the  future  may  have  in  store,  we  are  not  yet  ready  for 
state  control  of  railways.  For  the  immediate  future,  a 
decade  or  two,  the  best  intelligence  must  go  to  this  espe- 
cial evil  of  railroad  discrimination.  The  trust  plus  spe- 
cial railroad  favors  can  never  be  other  than  a danger 


34  TKUSTS — PRO  AND  CON. 

because  it  makes  directly  for  that  wider  economic  ine- 
quality that  is  already  peril  enough. 

I therefore  assume  that  no  answer  is  possible  to  my 
subject,  ^‘^Are  the  New  Combinations  Dangerous?^^  un- 
less that  measure  of  control  is  secured  which  is  repre- 
sented by  complete  publicity,  removal  of  tariff  privileges, 
and  the  ending  of  special  railway  favors.  I should  defend 
this  opinion  not  upon  theoretical  grounds  but  upon  such 
practical  experience  as  one  may  observe  already  on  the  field 
of  the  new  combinations. 

As  an  illustration  of  the  practical  working  of  the  three 
conditions  named  upon  a trust,  Mr.  Brooks  cited  the  fur- 
niture trust  in  England,  founded  by  E.  J.  Smith.  The 
speaker  said  that,  with  all  three  conditions  practically 
fulfilled,  the  furniture  was  not  in  politics,  asked  no  favors 
from  either  railroads  or  tariff,  had  checked  a mere  reck- 
less and  ruinous  competition,  and  was  sharing  its  profits 
with  the  workmen.  Mr.  Brooks  continued  as  follows: 

OVEECAPITALIZATION  CAN  BE  CHECKED. 

Given  an  absolute  publicity  of  facts  and  the  one  domi- 
nating danger,  overcapitalization,  is  already  half  met.  If 
the  trust  movement  spreads,  as  now  seems  likely,  by  far 
the  larger  part  will  go  to  the  wall  from  sheer  speculative 
bravado.  The  people,  meanwhile,  will  be  rapidly  edu- 
cated, and,  above  all,  the  banks  will  be  swift  to  learn  the 
lesson  and  refuse  to  underwrite  if  the  venture  is  too  im- 
prudent in  its  risks.  Only  those  trusts  will  survive  that 
are  prudently  organized,  and  deal  with  a product  which 
lends  itself  to  the  conditions  imposed  by  the  new  combi- 
nation. 

The  coming  contest  in  our  municipalities  is,  accurately, 
this:  Who  is  to  control  the  vast  machinery,  such  as 
lighting  and  transportation?  This  has  come  to  be  the 
deepest  struggle  in  trade  unionism.  Socialism  itself  can- 
not be  better  defined  than  by  its  attitude  toward  ma- 
chinery. 

Another  period  for  necessary  reorganization  is  upon 
us.  The  mechanism  for  this  is  the  yet  more  stupendous 
combination  we  are  considering.  It  will  do  precisely  what 
the  great  machinery  has  always  done — create  profound 


TRUSTS — PRO  AND  CON. 


35 


temporary  disturbance.  It  will  shut  hundreds  of  offices 
and  drop  thousands  who  were  working  on  the  displaced 
machines.  But,  meantime,  the  new  work  has  to  be  done 
under  new  forms,  and  when  the  readjustment  comes  more 
men  and  not  fewer  will  be  required  to  do  it.  There  is 
now  the  most  absolute  proof  that  the  growth  of  indus- 
trial machines  is  putting  to  work  a larger  and  larger  pro- 
portion of  the  people  of  the  United  States. 

The  new  combinations  that  survive  are  not  likely  to 
act  differently  in  this  respect  from  the  weaker  corpora- 
tions which  preceded  them.  Again,  it  is  said  they  will 
corner  things  generally,  put  up  prices,  and  prevent  the 
consumer  from  getting  the  advantage  of  the  economics 
made,  as  we  are  told  is  the  case  with  nails,  glass,  tinplate, 
etc.  I will  not  deny  the  danger,  but  I beg  to  submit  one 
observation  from  industrial  history:  Whenever  a great 
change  has  come  in  economic  evolution,  there  is  naturally 
extreme  danger  connected  with  the  new  undertaking,  be- 
cause traditional  methods  cannot  be  depended  upon.  The 
dangers  of  disaster  are  extreme,  and  only  men  of  great 
boldness  come  to  the  front.  It  is  this  type  of  man  that 
has  caught  the  wave  as  it  rose  and  made  enormous  prof- 
its. Human  wit  has  never  yet  prevented  this,  and  it  is 
more  than  doubted  if  it  would  be  well  to  do  it  if  we  could. 

Mr.  Brooks  here  alluded  to  the  risks  that  were  taken  by 
the  farsighted  and  courageous  business^men  when  the  new 
organization  of  the  factory  began.  He  cited  the  fact  that 
in  England,  during  the  formation  period,  profits  of  200, 
300,  and  400  per  cent  were  not  uncommon,  and  argued 
that  nothing  could  prevent  men  from  venturing  into  a 
field  where  such  large  returns  were  to  be  had  through  or- 
ganization. The  public  would  also  come  in  for  its  share 
of  the  advantages  of  the  coming  organizations.  In  con- 
clusion Mr.  Brooks  said: 

^mnVEESAL  ECONOMIC  INDEPENDENCE.’^ 

When  competition  has  reached  such  terrible  limits  as 
it  now  has  in  many  phases  of  making  and  distributing 
wealth,  it  is,  according  to  our  mood,  the  climax  of  humor 
or  pathos  to  talk  too  loudly  of  universal  economic  inde- 
pendence. As  all  may  observe,  it  is  for  a large  percentage 


36 


TKUSTS — PRO  AND  CON. 


of  small  business-men  a most  haphazard  and  tottering  in- 
dependence. It  is  this  helter-skelter  condition  that  we 
have  to  compare  with  what  the  new  combinations  will 
eventually  bring  about. 

Once  more^  it  is  said  of  the  trusts  ^^they  will  raise 
havoc  with  our  politics.’^  That  this  is  a far  graver  peril 
than  any  economic  one  is  too  clear.  Eecognizing  ^e  mag- 
nitude of  this  danger  and  with  no  desire  to  minimize  it, 
I express  this  hope:  The  trust  that  stays  will  bring  the 
ablest  men  to  the  front.  They  will  soon  have  to  carry 
on  business  in  an  atmosphere  of  public  opinion  thor- 
oughly alert  -and  aroused  upon  these  issues.  It  appears 
to  me  unlikely  that  men  of  first  ability  will  so  fail  in 
tact  as  to  disregard  and  affront  an  alarmed,  suspicious,  and 
powerful  public  opinion. 


A HOPEFUL  COURSE  OF  PROCEDURE. 


WILLIAM  FORTUNE. 

Professor  Brooks  was  followed  by  William  Fortune, 
president  of  the  Indiana  State  Board  of  Commerce.  He 
said  in  part: 

It  will  be  folly  to  undertake  reckless  warfare  for  the 
annihilation  of  trusts,  but  the  claws  of  the  monster,  if 
that  it  be,  can  be  cut,  and,  under  the  restraining  influ- 
ences of  good  regulations,  this  Behemoth,  biggest  born 
of  commerce,  may  become  a docile,  harmless,  and  really 
amiable  family  pet. 

This  humanitarian  cry  against  the  individual  hardships 
of  trusts,  however  distressing  it  may  be  and  however  much 
it  may  appeal  to  sympathy,  will  not  be  more  effectual 
than  has  been  the  outcry  for  the  same  reason  against 
labor-saving  machinery  and  methods.  Economic  opera- 
tion is  in  itself  an  inexorable  law. 

The  danger  now  most  gravely  apprehended  is  not  that 
labor  will  suffer,  but  that  aggregated  capital  will  drive  out 
of  competitive  channels  the  weaker  capital,  and  that  com- 
mercial monopoly  will  result  in  oppression  of  multitudes 


TRUSTS — PRO  AND  CON. 


37 


of  consumers  who  have  no  share  in  the  benefits  of  com- 
binations. The  defensive  power  of  labor^  wisely  directed 
through  organization^,  is  strong  enough  to  compel  capital 
to  accord  to  it  the  share  due  it. 

It  is  the  right  of  society  to  know  if  this  new-born 
creature  of  conditions  is  humanity’s  offspring  or  is  a coiled 
serpent.  We  know  enough  now  to  make  it  clear  that 
the  first  steps  should  be  in  the  direction  of  regulation 
and  study  of  the  developments  of  the  problem.  Though 
the  promise  be  less^  the  results  will  be  quicker  than  the 
uncertain  realization  of  Utopian  hopes  or  radical  de- 
mands. 


OPPOSED  TO  TRUSTS. 


GOV.  G.  W.  ATKINSON,  OF  WEST  VIRGINIA. 

The  first  speaker  of  the  evening  session  of  the  first 
day  was  Gov.  Atkinson,  of  West  Virginia.  He  spoke  as 
follows: 

Mr.  President  and  Gentlemen  of  the  Convention:  This 
gathering  is  to  consider  the  relations  of  our  citizens  to 
one  another  as  citizens,  and  to  consider  the  best  methods 
to  be  used  to  protect  the  masses  from  the  encroachments 
of  combines  and  trusts,  for  it  seems  that  this  is  a period 
favorable  to  the  organization  of  such  combines  all  over 
the  civilized  world. 

I believe  in  progression.  In  this  respect,  I am  an  evo- 
lutionist. I believe  that  the  world  ought  to  grow,  and 
that  men  ought  to  grow  with  it.  Some  sorts  of  combines 
are,  I think,  economic  necessities.  The  great  manufac- 
turing establishments  of  the  world,  covering  all  branches 
of  industry,  had  small  beginnings;  and  we,  in  a large 
measure,  owe  the  progress  we  have  made  to  men  of  means 
who  combined  or  united  into  what  we  call  ‘^^corporations.” 

Nevertheless,  we  have  thousands  and  tens  of  thousands 
of  people  who  seem  to  hate  them,  and  fight  them,  not- 
withstanding the  fact  that  they  secure  from  such  concerns 
reasonable  compensation  for  their  toil,  and  by  means  of 


38 


TKUSTS — PRO  AND  CON. 


which  they  obtain  the  necessary  means  with  which  they 
support  their  families. 

FKIEND  AND  BACKEK  OF  COEPOKATIONS. 

With  this  class  of  people  I have,  no  sympathy.  A cor- 
poration, properly  conducted,  is  entitled  to  as  much  sym- 
pathy, support,  and  respect  as  an  individual,  because  a 
corporation  in  law  is  an  individual.  I wish,  therefore, 
to  be  written  down  as  a friend  and  backer  of  corporations 
because  no  state  can  be  developed  without  them.  When 
I hear  men  in  politics  and  elsewhere  whining  the  dema- 
gogue cry  ^^Down  with  corporations,^^  I am  ready  to  join 
the  crowd  of  enterprising  people  who  will  cry,  ^^Down 
with  that  class  of  malcontents  and  demagogues  I am 
not  an  optimist,  per  se,  nor  am  I a pessimist.  I have  no 
sympathy  for  anyone  who  puts  in  his  time  whining  against 
capital.  We  unfortunately,  how^ever,  have  too  many  of 
this  class  of  croakers.  What  we  need  is  more  capital  in 
legitimate  business  undertakings.  We  must  have  men 
everywhere  who  will  invest  their  money  in  building  up 
and  opening  up  the  industries  of  all  of  our  states. 

AEBITEATION  FOE  CAPITAL  AND  LABOE. 

Now,  I take  it,  that  all  present  understand  how  I feel 
toward  capitalists  and  toward  corporations  which  always 
represent  capital  and  capitalists.  The  next  point  to 
which  I desire  briefly  to  allude  is  the  labor  problem.  I 
am  now  and  always  have  been  a staunch  friend  of  the 
toiling  masses.  I stand  for  the  working  man,  because  he 
alone  produces  wealth.  Labor  and  capital  are  interdepend- 
ent. The  laboring  men  have  the  same  right  to  organize 
for  their  advancement  and  protection  as  have  the  capi- 
talists. So  long  as  the  laboring  man  does  his  duty,  and 
keeps  within  the  limits  of  the  law,  he  will  have  my  sym- 
pathy and  support.  But  I have  never  yet  favored  a strike 
or  a lockout  so  long  as  it  was  possible  to  prevent  it  by 
just  and  friendly  arbitration;  and  I have  never  yet  known 
a strike  or  a lockout,  in  all  my  experience  and  observa- 
tion, that  did  not  result  in  injury  to  both  labor  and  capi- 
tal. Therefore,  Mr.  Chairman,  I favor  arbitration  to 
settle  all  disputed  problems  between  capital  and  labor. 


TKUSTS — PEO  AND  CON. 


39 


EEMEDY  IS  IN  LEGISLATION,  NOT  POLITICS. 

In  all  my  public  and  private  acts  in  the  past  my  mus- 
ket has  been  pointed  against  trusts,  and  if  I know  myself 
to-day  it  is  still  pointing  the  same  way.  I find  about  as 
many  Democrats  in  trusts  in  the  United  States  as  Ee- 
publicans,  and  I find  at  least  two  of  the  mammoth  trusts 
of  this  country  are  in  a sense  Democratic  trusts.  There- 
fore I conclude  we  cannot  choke  them  out  by  drawing 
political  lines  upon  them.  We  must  come  nearer  home, 
for  a remedy  than  that.  We  must  hit  at  its  tap  root  by 
a national  and  state  legislation,  by  making  it  a penal 
offense  against  good  government  for  men  of  great  wealth 
to  combine  for  the  sole  purpose  of  stifling  and  choking 
middle  men  and  small  dealers,  as  trusts  have  generally 
done  in  the  past.  Or,  better  still,  if  the  trusts  would  take 
their  employes  into  their  combines  and  their  confidence, 
and,  after  paying  themselves  a reasonable  dividend  on 
the  actual  amount  of  capital  stock  invested,  then  agree 
to  distribute  a reasonable  share  of  the  profits  among  the 
skilled  artisans  whom  they  employ  as  a percentage  or 
profit  upon  their  wages,  the  trusts  would  then  be  placed 
upon  an  honest,  popular,  and  reasonable  foundation,  and 
no  one  could  complain  or  justly  oppose  them.  I can 
see  no  reason  why  such  an  experiment  might  not  be  made 
by  employers,  nor  can  I see  why  it  would  not  succeed. 
So  long  as  the  trust  stands  as  it  is  to-day,  that  long  it 
will  be  antagonized  by  the  masses,  and  it  therefore  can- 
not be  enduring,  nor  can  it  result  as  a permanent,  profit- 
able investment  for  the  stockholders,  or  the  mechanics, 
or  the  people  in  general. 

SEASONS  TKUSTS  AEE  WEONG. 

It  may  not  be  wrong  that  a number  of  factories  in  a 
particular  industry,  which  have  been  competing  with  one 
another  in  a particular  line  of  production,  agree  to  unite 
for  a common  purpose,  consenting  to  not  fight  one  an- 
other, and  purposing  to  furnish  a particular  article  of 
manufacture  to  the  consumer  at  a specific  price.  Indeed, 
it  appears  to  be  right  on  its  face,  but  it  may  be  wrong, 
forever  wrong,  and  usually  is  wrong,  as  I see  it,  for  two 
reasons: 


40 


TRUSTS — PRO  AND  CON. 


First — This  combine  can  and  will — if  it  is  looking  out 
for  its  own  interests  alone — increase  the  price  of  its  pro- 
duct to  the  consumer  and  at  the  same  time  reduce  the 
wages  of  its  employes. 

Second — Every  small  manufacturer  engaged  in  that  par- 
ticular industry  will  either  have  to  quit  business  or  join 
'The  combine.^^  But  the  combine  will  doubtless  say  in 
reply  that  the  small  manufacturer  can  himself  join  the 
trusty  or  keep  on  as  he  is  then  doings  if  he  likes.  How, 
I ask,  can  he  continue  his  business  successfully  if  all  his 
competitors  in  the  same  line  of  production  have  com- 
bined against  him?  They  can  and  will,  for  the  purpose 
of  "freezing  him  out,^^  cut  prices  until  he  has  "to  squeal 
and  throw  up  the  sponge,^^  and  then  the  combine  has 
its  own  way  and  can  fix  its  own  prices,  and  it  usually 
does.  In  cases  of  this  sort  the  small  dealer  succumbs  and 
the  combine  fixes  its  own  prices  and  the  people  are  com- 
pelled to  submit. 

If  the  advocates  of  and  participants  in  the  trusts  could 
satisfy  the  minds  of  the  masses  upon  the  following  prop- 
ositions they  would  then  have  only  a limited  proposition 
in  the  years  to  come:  Will  you  and  can  you  in  all  cases, 
as  you  claim,  agree  to  furnish  a better  and  cheaper  article 
to  consumers  of  all  the  necessaries  of  life  covered  by 
your  trusts  and  combines?  What  do  you  propose  to  do 
with  the  tens  of  thousands  of  middle  men  now  employed, 
who  must  lose  their  present  positions?  What  will  become 
of  the  small  dealers  scattered  over  our  country? 

It  is  not  my  purpose  or  desire  to  block  any  avenue 
to  the  progress  and  development  of  my  country,  but  it 
is  my  purpose  and  desire  to  do  anything  and  everything 
I can  to  aid  the  working  man  to  earn  an  honest  liveli- 
hood for  himself  and  those  dependent  upon  him  in  the 
ever  existing  scuffle  between  man  and  man  to  live  and  to 
let  live,  which  has  been  going  on  from  Adam  down  to 
McKinley. 


TRUSTS — PRO  AND  CON. 


41 


TRUST  DEBTS  MUST  BE  PLACED. 


C.  E.  CROW. 

Governor  Atkinson  was  followed  by  Hon.  C.  E.  Crow^ 
Attorney  General  of  Missouri^  who  presented  the  benefit 
that  would  come  from  attaching  the  liabilities  of  partner- 
ship to  the  members  of  trust  corporations.  This  would 
keep  down  speculation  and  deter  millionaires  from  enter- 
ing into  such  corporations.  If  the  trading  business  cor- 
poration must  exist  he  advocated  enaction  of  laws  by  the 
states  declaring  members  of  the  corporations  responsible 
to  the  same  extent  as  members  of  a copartnership. 

At  the  commencement  of  the  history  of  the  business 
worlds  the  individual  was  the  basis  of  all  business.  It 
early  became  evident  that  associations  of  individuals^,  com- 
bining their  capital  and  efforts^  would  be  advantageous  in 
a business  way,  and  this  gave  rise  to  the  association  of 
individuals  into  partnership.  As  partners,  each  individ- 
ual w^as  compelled  to  respond  with  his  private  fortune  for 
any  liability  of  the  partnership.  Still  later,  associations 
of  individuals  were  formed  to  do  a private  business  as 
a trading  corporation,  giving  each  shareholder  a share  in 
the  profits  made  possible  by  unsafe  speculation,  with 
the  absolute  guarantee  of  no  liability  beyond  the  amount 
of  his  stock. 

The  corporation  risks  nothing  but  the  capital  employed. 
Its  field  is  as  wide  as  civilization,  and  it  is  not  dissolved 
even  by  the  death  of  its  members.  This  distinction  in 
liability  of  the  individuals  must  be  borne  in  mind  in 
dealing  with  the  modern  trust  question  from  a legal  stand- 
point. The  perfect  modern  trust  to-day  takes  the  shape 
of  a corporation  to  which  is  conveyed  the  business  of 
the  various  individuals  and  corporations,  the  members  as- 
suming no  liability  beyond  the  amount  of  their  share- 
holdings. Therefore  it  is  plain  to  be  seen  that  the  in- 


42 


TKUSTS — PEO  AND  CON. 


centive  of  corporate  trust  creations  has  ever  been  and  ever 
will  be  to  secure  the  greatest  opportunity  for  profit  with 
the  least  amount  of  liability  to  loss.  A private  corpora- 
tion is  purely  a creature  of  law. 

LIMIT  OF  ACTION  AGAINST  TEUSTS. 

If  the  trust  organizers  could  carry  on  their  business 
through  corporations  with  the  liabilities  of  a partnership, 
the  members  of  the  trust  would  have  the  same  opportu- 
nities and  equal  liabilities  with  the  individual  compet- 
itor. Equality  of  opportunity  and  responsibility,  instead 
of  special  privilege,  would  exist.  State  statutes  give  a 
right  of  action  in  many  instances  for  damages  against 
trusts  injuring  competition  in  efforts  to  control  the  mar- 
ket, but  where  the  trust  is  a corporation,  with  the  pres- 
ent liability  attaching  thereto,  the  action  can  only  be 
against  the  corporate  entity  itself. 

But  suppose  the  corporation  and  the  members  thereof 
had  attached  to  them  the  liabilities  of  the  partnership. 
Then  the  right  of  action  would  be  against  not  only  the 
corporation  but  each  individual  member  of  the  corpora- 
tion. This  fact  would  deter  millionaires  from  becoming 
members  of  trade  combinations,  make  men  cautious,  and 
keep  down  inflation  of  values  and  wild  speculation.  The 
control  of  a corporation  is  easy  because  it  depends  upon 
a mere  matter  of  dollars  to  buy  a majority  of  stock  and 
not  the  individual  will  of  the  shareholders.  One  man 
may  control  the  majority  of  the  stock,  although  there 
may  be  an  hundred  stockholders. 


TBUSTS  HURT  SALESMEN. 


P.  E.  DOWE. 

P.  E.  Dowe,  president  of  the  Commercial  Travelers^ 
National  league,  spoke  from  the  point  of  view  of  the 
commercial  travelers,  showing  that  they  had  been  the 
earliest  victims  of  a business  situation  brought  about  by 
trusts.  He  said: 


TRUSTS — PRO  AND  CON. 


43 


I have  gone  on  record  as  opposed  to  trade  combines, 
otherwise  trusts,  for  specific  reasons.  I also  have  been 
interested  in  other  matters  pertaining  to  the  privileges  of 
the  people  generally,  and  commercial  travelers  particularly, 
and  a participant  in  contests  to  protect  the  rights  of  the 
people  from  infringement  by  unjust  laws.  It  was  not  un- 
til I had  been  elected  president  of  the  Commercial  Trav- 
elers^ I^ational  league  in  1897,  however,  that  it  dawned 
upon  me  that  the  commercial  men  were  to  be  made  the 
first  victims  of  the  situation;  yet  at  that  time  I had  but 
an  imperfect  conception  of  the  great  magnitude  of  the 
trust  movement,  and  must  confess  that  it  was  not  until 
the  last  half  of  the  year  1898  that  I fnlly  realized  the 
danger  and  extent  of  the  centralization  of  capital  and 
the  monopolizing  of  commodities. 

TEAVELING  MEN  LOSE  THEIK  PLACES. 

Reports  began  to  reach  me  of  first-class  salesmen  be- 
ing dispensed  with  for  no  reason  other  than  the  fact  that 
trusts,  ‘‘^conceived  of  greed,  born  of  dishonesty,  and  cradled 
in  the  lap  of  injustice,'^  had  assumed  the  octopus  form 
and  taken  within  far  reaching  tentacles  all,  or  nearly  all, 
the  concerns  in  specific  lines  of  trade,  and  were  sucking 
the  life  from  fair  and  honest  competition.  Trust  manipu- 
lation for  the  purposes  of  controlling  a particular  line 
and  fixing  the  prices  and  quality  of  its  commodities  meant 
that  the  traveling  salesman  must  go — aye,  ^^go,^^  any- 
where, to  heaven  or  the  other  place,  for  aught  the  trust 
'magnates  care. 

Mr.  Dowe  then  discussed  the  magnitude  of  the  trust 
problems.  The  purpose  of  his  paper  he  declared  to  be 
to  demonstrate  trusts  are  considered  as  ^^an  abominable 
curse^^  by  the  people. 

GROWTH  OF  THE  TRUSTS. 

Previous  to  1895,  he  said,  nearly  600  trusts  were  pro- 
jected, and  to  include  a great  variety  of  commodities; 
several  of  these  trade  combinations  failed  to  materialize, 
some  disintegrated;  but  the  processes  for  the  centraliza- 
tion of  capital  and  power  continued,  combination  and 
re-combination  going  on,  till  in  March  last  there  were 


44 


TRUSTS — PRO  AND  CON. 


between  350  and  360  combines^  yet  their  capitalization  was 
billions  more  than  the  capitalization  of  the  600  trusts 
of  1894  and  before.  To-day  my  list  shows  425  trusts. 

The  number  of  business  concerns  absorbed  by  the  grad- 
ual and  systematic  efforts  to  obtain  control  of  the  mar- 
kets and  highways  figures  5^565,  say  5^600  in  round  num- 
bers, exclusive  of  the  grape  growers,  lake  vessels  and 
dredges,  milk  dealers  and  farmers,  milk  combines;  also 
insurance,  telephone  and  telegraph,  railroads  and  street 
railways,  electric  light,  gas,  ice,  water,  and  steamship 
trusts.  I will  assume  for  argument  that  the  capital  will 
average  for  each  concern  not  more  than  $200,000,  or,  for 
5,565  concerns,  $1,113,000,000,  about  an  eight  to  one 
ratio  of  valuation  for  speculative  purposes. 

What  if  the  trusts  win?  “^^The  whole  machinery  of  in- 
dependence as  we  have  known  it  heretofore  in  this  coun- 
try is  entirely  gone,  and  man,  whatever  his  prospects 
might  have  been,  is  absolutely  at  the  mercy  of  the  trust. 
It  must  feed  him,  clothe  him,  shelter  him,  and  educate 
him,  as  will  serve  its  interests.^^ 

The  remedy  for  the  plague  of  trusts,  now  epidemic,  I 
have  not  discussed,  the  purpose  of  my  paper  being  to 
demonstrate  that  trusts  are  considered  as  an  abominable 
curse  by  the  people.  I speak  for  the  commercial  travel- 
ers especially  and  for  the  people  generally  in  opposition 
to  trade  combines,  for  the  commercial  men  have  felt  the 
pulse  of  the  people  as  could  no  other  class. 


COMPETITION  FOSTERED  BY  TRUSTS. 


FRANCIS  B.  THURBER. 

Francis  B.  Thurber,  representing  the  New  York  Board 
of  Trade,  was  strong  in  defense  of  combinations  of  cap- 
ital. He  said  the  right  to  combine  had  been  exercised 
through  all  time.  He  blamed  existing  criticism  to  ^^sudden 
development  and  sensational  journalism.^^  He  told  of  what 
he  considered  unjust  legislation,  national  and  state,  against 
capital,  and  laid  particular  stress  on  the  Texas  law.  He 


TRUSTS — PRO  AND  CON. 


45 


said  he  used  to  be  a foe  of  trusts^  but  had  grown  to  see 
the  equality  of  their  claims.  He  said  competition  was 
fostei^ed  by  trusts,  not  crushed,  and  as  an  instance  he 
cited  the  sugar  war  waged  by  the  Arbuckles.  In  conclu- 
sion he  said: 

It  is  overlooked  that  corporations  are  really  coopera- 
tions; that  the  number  of  partners  as  stockholders  in  any 
industry  is  increased;  that  any  one  can  become  a partner, 
and  that  instead  of  being  concentrators  of  wealth,  they  are 
distributers  of  wealth.  It  has  been  assumed  that  labor 
would  be  oppressed  by  the  organization  of  capital,  but  ex- 
perience has  shown  that  organized  labor  has  met  organized 
capital,  and  that  the  largest  organizations  of  capital  have 
furnished  the  steadiest  employment  and  have  paid  larger 
wages  than  individual  employers. 

The  grievances  of  individuals  injured  in  this  evolution 
of  industries  have  been  magnified  and  the  general  good 
minimized.  The  lesson  of  the  stage  driver  thrown  out  of 
work  by  the  locomotive,  or  the  workman  by  the  machine, 
is  forgotten  when  the  traveling  salesman  who  loses  his  job 
through  the  economies  of  industrial  organization  appeals 
to  public  sympathy.  That  wider  markets  are  necessary 
and  that  large  capital  intelligently  administered  is  neces- 
sary to  find  them,  is  not  appreciated.  That  ^^rule  of  rea- 
son,^^  as  expressed  by  the  minority  of  the  Supreme  Court, 
is  in  danger  of  being  expunged  from  our  statutes. 

Within  the  limits  of  a paper  like  this  it  is  of  course  im- 
possible to  do  more  than  speak  suggestively  and  touch 
upon  but  few  of  the  many  points  involved,  but  I have  faith 
that  with  further  study  of  this  subject  by  the  American 
people  the  facts  will  become  plainer  and  they  will  appre- 
ciate that 

^^Through  the  ages  one  increasing  purpose  runs. 

And  the  thoughts  of  men  are  widened  by  the  process  of 
the  suns.” 


46 


TRUSTS — PRO  AND  CON, 


LIMITATIONS  OF  COMPETITION  AND 
COMBINATION 


JOSEPH  NIMMO,  JR.,  LL.  D. 

The  first  day's  session  was  closed  by  Joseph  Nimmo,  Jr., 
of  Washington.  He  spoke  upon  ‘^^The  Limitation  of  Com- 
petition and  of  Combination  as  Illustrated  in  the  Eegula- 
tion  of  the  Railroads.^^  He  said,  in  part: 

In  the  excitement  attending  every  epochal  period  and 
every  popular  movement  for  the  correction  of  real  or  fan- 
cied evils  remedies  essentially  revolutionary  and  destructive 
in  character  are  apt  to  be  proposed.  Such  will  inevitably 
be  the  case,  as  attempts  are  being  made  to  settle  that  great 
question  the  consideration  of  which  has  called  together 
from  all  parts  of  the  United  States  this  convocation  of  men 
of  learning  and  of  large  practical  experience. 

The  specific  question  presented  for  our  consideration  is 
that  of  ^^trusts,^^  as  the  word,  by  a process  of  misuse,  has 
come  to  have  significance  in  the  public  mind.  The  real 
issue  relates  to  the  manner  in  which  and  the  extent  to 
which  the  recent  movement  toward  the  restraint  of  compe- 
tition, through  combination  or  through  the  power  of  ag- 
gregated capital,  in  individual  or  in  corporate  hands, 
should  be  limited  or  controlled  by  governmental  authority. 
This  question  presents  itself  under  a great  variety  of  forms 
from  the  fact  that  there  are  many  kinds  of  combinations, 
agreements,  and  co-operative  arrangements  differing  widely 
in  their  nature  and  scope  and  in  their  constraining  influ- 
ence upon  competition.  In  many  instances  argument  is 
coufused  by  the  indiscriminate  use  of  the  term  combination 
to  express  different  forms  of  associated  effort.  This  should 
be  carefully  guarded  against. 

Mr.  Nimmo  took  up  in  detail  the  evolved  law  of  the 
American  railroad  system,  the  interstate  commerce  law. 


TRUSTS— PEO  AND  CON. 


47 


attempts  of  the  interstate  commerce  commission  to  gain 
additional  powers^  the  usurpation  of  power  by  the  commis- 
sion^ expedients  and  methods  by  which  the  commission  pro- 
poses to  accomplish  its  purposes. 


REVIEW  OF  THE  FIRST  RAWS  SESSIOH. 


DR.  ALBERT  SHAW. 

Editor  of  “Review  of  Reviews.’’ 

It  seems  to  me  the  opening  day  of  the  conference  on 
combinations  and  trusts  justifies  the  attempt  of  the  Civic 
federation  to  bring  together  men  from  all  parts  of  the 
country  to  exchange  views  on  the  most  extraordinary  and 
significant  changes  in  business  conditions  that  have  been 
witnessed  for  a hundred  years.  Different  shades  of  opinion 
are  well  represented,  and  a certain  feeling  on  the  part  of 
the  more  extreme  men  of  diametrically  opposite  views  that 
one  side  or  the  other  might  endeavor  to  control  the  con- 
ference and  limit  freedom  of  discussion  was  entirely  dis- 
pelled by  the  events  of  the  day. 

There  was  evident  determination  in  the  morning  session 
to  make  sure  that  no  cut  and  dried  program  should  be 
forced  upon  the  conference.  The  Chicago  committee,  on 
its  part,  was  more  than  willing  to  allow  the  conference  to 
arrange  its  program  to  suit  itself.  The  slight  danger  of 
some  radical  difference  of  opinion  respecting  organization 
was  happily  obviated  by  mutual  concessions,  and  by  even- 
ing it  was  perfectly  clear  that  every  point  of  viev/  was  going 
to  have  a fair  chance.  The  selection  of  a permanent  chair- 
man was  appropriate  and  satisfactory.  Judge  Howe  of 
Hew  Orleans  will  deal  fairly  with  all  sections  and  will  pre- 
side with  dignity  and  efficiency. 

The  best  results  of  the  conference  will  perhaps  be  found 
in  the  more  informal  contact  of  the  representatives  from 
different  sections. 

The  academic  element  in  the  conference  is  evidently  go- 


48 


TRUSTS — PRO  AND  CON. 


ing  to  be  exceptional  on  many  accounts.  Among  the  dele- 
gates are  a number  of  the  most  distinguished  professors 
of  political  economy  and  students  of  industrial  and  social 
conditions  that  this  country  has  produced.  Among  these 
men  are  Professor  Adams  of  Ann  Arbor,  Professor  Pol- 
well  of  Minnesota,  Professor  Jenks  of  Cornell,  Professor 
Clark  of  Columbia  University,  N.  Y.;  Professor  Ely  of  the 
University  of  Wisconsin,  Professor  John  Graham  Brooks, 
and  a number  of  others. 

This  professional  element  in  general  might  be  said  to 
believe  that  the  combination  of  capital  is  a legitimate  and 
necessary  modern  tendency,  and  that  it  is  no  more  possible 
to  smash  the  trusts  than  to  interfere  with  the  movement  of 
the  heavenly  bodies;  but,  qn  the  other  hand,  it  is  clearly 
their  opinion  that  there  is  pressing  need  for  radical  reforms 
in  corporation  law,  that  great  publicity  in  the  manage- 
ment of  large  corporations  is  necessary,  and  that  various 
regulations  for  the  protection  of  industries  on  the  one  hand 
and  the  consumers  on  the  other  are  pressing  needs. 

A considerable  portion  of  the  labor  element  represented 
in  the  conference  is  also  friendly  to  trusts,  provided  the 
trusts  recognize  what  they  call  just  claims  of  organized 
labor. 

The  discussions  of  the  first  day  have  been  devoted,  in  the 
main,  to  what  may  be  called  definitions  and  general  reflec- 
tions. The  work  of  the  conference  will  become  more  prac- 
tical when  it  deals,  as  it  will  on  the  following  days,  with 
practical  remedies  for  those  phases  of  the  trust  movement 
that  are  decidedly  objectionable. 

There  is  undoubtedly  an  extremely  remarkable  array  of 
representative  American  ability  in  the  conference,  and 
upon  the  whole  it  is  only  fair  to  say  that  all  elements  show 
a high  degree  of  sincerity  and  patriotism.  The  conference 
will  have  been  useful  if  it  succeeds  in  helping  to  put  the 
great  discussion  which  must  be  carried  on  in  the  press  and 
on  the  platform  for  a good  while  to  come  upon  sound,  dis- 
criminating lines.  ALBEKT  SHAW. 


TKUSTS — PRO  AND  CON. 


49 


PROFESSOR  COMMONS^  V1E^Y. 


Professor  J ohn  E.  Commons,  of  the  Bureau  of  Economic 
Eesearch,  New  York,  made  the  following  comment  upon 
the  first  day^s  work: 

The  first  day^s  session  of  the  trust  conference  is  bewilder- 
ing and  unsettling.  Professor  Jenks  gave  us  a clear-cut 
statement  of  what  each  side  claims.  He  laid  out  a pro- 
gram of  discussion,  and  it  is  a pity  that  the  program  is  not 
to  be  followed  point  by  point.  "^These  set  papers,  where 
each  man  covers  the  whole  field,  are  good  enough  for  the 
first  day,  but  they  elude  the  critical  points.  If  we  could 
have  open  discussions  and  one  session  given  wholly  to 
overcapitalization,  another  to  railroad  discriminations,  an- 
other to  the  tariff  and  patents,  another  to  middlemen,  an- 
other to  laborers,  another  to  consumers  and  prices,  with 
speakers  pro  and  con  for  each  session,  then  we  could  begin 
to  clear  the  brush  and  see  the  light.  The  issues  would  be 
squarely  made  and  fought  out. 

As  it  is,  the  first  day  was  valuable  as  a study  of  social 
types.  There  was  Governor  Atkinson  with  the  politician’s 
buncombe,  who  told  us  nothing.  He  was  the  “^Triend”  of 
capital  and  labor,  but  of  ^^offensive”  capital  or  labor,  what- 
ever that  may  be. 

The  man  from  Texas  came  the  nearest  to  that  sturdy 
American  independence  that  unloaded  the  tea  in  Boston 
harbor  for  principle’s  sake.  He  knows  the  history  of  his 
country  and  is  true  to  its  traditions.  Equality,  justice,  in- 
dividualism are  his,  even  though  they  cost  more  money. 
He  sees  clearly  how  corporations,  these  fictitious,  intangi- 
ble persons  created  by  law,  were  unknown  to  the  fathers, 
and  how  the  constitution  which  they  framed  to  protect 
^‘^natural”  persons  of  blood  and  flesh  has  been  diverted  to 
protect  these  artificial  persons.  Eloquently  he  declared 
that  this  nation  could  not  survive  ^^half  natural  citizenship 


50 


TRUSTS — PRO  AND  CON. 


and  half  artificial  citizenship.^^  He  gave  us  the  farmer’s 
view — the  American  farmer,  not  the  peasant — and  he  is 
one-half  the  people. 

But  Professor  Brooks  was  right  in  his  criticism.  That 
old  Americanism  is  out  of  date.  The  trust,  or  some  kind 
of  consolidation  of  business,  is  being  forced  upon  us  by  the 
struggle  for  survival. 

This  is  not  the  view  of  Professor  Henry  C.  Adams,  whose 
paper  was  the  keenest  and  wisest  of  the  day.  It  should  be 
clipped,  and  saved,  and  studied.  Eailway  discriminations, 
inadequacy  of  state  laws,  the  new  view  of  corporations  as 
individual  property  rather  than  an  arm  of  the  state,  as  of 
old,  appeared  to  him  to  be  the  causes  of  the  manufactur- 
ing monopoly.  The  remedy  is  publicity  under  federal  con- 
trol. 

We  have  not  heard  the  trust  defenders.  It  behooves 
them  to  show  that  Adams  is  wrong  and  that  the  manufac- 
turing trust  is  as  natural,  inevitable,  and  impregnable  as 
the  railway  monopoly.  JOHN  K.  COMMONS. 


IBUSTS — PRO  AND  CON, 


51 


SECOND  DAY. 


TBUSTS  AND  TEE  TARIFF. 


LAWRENCE  PURDY. 

The  second  day  of  the  Conference  opened  with  a dis- 
cussion of  tariff  in  its  relations  to  trusts.  Mr.  Lawrence 
Purdy  of  the  New  York  Tariff  Keform  League  was  the 
first  speaker.  He  said: 

Everyone  is  familiar  with  the  attempt  to  foster  and 
maintain  competition  in  the  supplying  of  gas  and  electric- 
ity and  in  the  carriage  of  passengers  and  goods  on  rail- 
ways, and  the  result  has  been  the  merging  of  competing 
lines  or  some  combination  between  them  to  maintain  prices 
and  divide  the  business. 

The  difference  of  opinion  which  now  exists  as  to  the 
manner  in  which  natural  monopolies  such  as  these  should 
be  treated  is  a difference  of  degree  rather  than  a difference 
of  kind.  The  opinion  is  practically  unanimous  that  there 
must  be  some  governmental  regulations  and  supervisions, 
and  more  and  more  are  coming  to  the  conclusion  that  gov- 
ernmental regulation  should  extend  to  the  point  of  abso- 
lute ownership  and  operation. 

It  is  the  combination  of  concerns  which  are  naturally 
competitive,  and  such  combinations  as  establish  a partial 
or  complete  monopoly,  which  I wish  to  discuss. 

I do  not  contend  that  the  only  cause  for  combinations 
which  restrain  trade  is  the  tariff,  but  the  tariff  does  foster 
and  assist  in  maintaining  such  combinations.  The  tariff 
is  under  the  control  of  the  federal  government,  the  aboli- 
tion of  duties  upon  articles  produced  by  trusts  is  easy, 
immediate  and  effective.  When  this  special  privilege  is 


53 


TRUSTS — PRO  AND  CON. 


withdrawn  we  will  then  be  in  a better  position  to  do  what 
further  may  be  necessary. 

I believe  we  have  passed  the  point  where  any  objection 
can  be  raised  to  the  abolition  of  protective  duties  on  the 
ground  that  they  sustain  or  raise  wages.  Years  ago  we 
had  the  testimony  of  Mr.  Evarts  and  Mr.  Blaine  that 
American  labor  was  the  cheapest  in  the  worlds  and  re- 
ceived the  smallest  share  of  its  own  product.  We  have 
grown  great  in  manufacturing  because  we  have  the  most 
skilled  labor  and  the  best  material  with  which  to  work. 
The  truth  is  that  the  tariff,  by  shutting  out  foreign  compe- 
tition, enables  the  trusts  to  shut  down  domestic  factories, 
emplcv  less  labor  and  thereby  reduce  wages.  Mills  make 
money  by  shutting  down  instead  of  by  the  production  of 
goods. 

It  is  sometimes  said:  ^^Law  made  trusts  and  law  can  un- 
make them.’^  I believe  this  is  absolutely  true,  but  I think 
it  commonly  conveys  a wrong  impression.  Law  has  made 
trusts  by  conferring  special  privileges,  and  those  privileges 
can  be  abolished.  The  chief  privilege  and  the  one  most 
easily  reached  is  the  tariff.  Let  no  one  imagine  that  cor- 
porations, which  are  creatures  of  law,  are  the  only  trusts, 
for  secret  agreements  between  individuals  have  been  ef- 
fective to  control  supply  and  raise  prices  without  a single 
corporation  being  involved. 

The  doctrine  of  ^^Laissez  faire^^  has  been  much  abused  and 
it  is  common  to  hear  that  it  has  failed.  It  has  never  yet 
been  tried.  It  does  not  mean  ^‘^Let  things  alone  as  they 
are,^^  but  ^^Clear  the  road  and  let  them  alone.^^  Clear  away 
every  special  privilege.  Then  and  not  till  then  can  we 
know  whether  any  restriction  is  necessary.  While  special 
])rivileges  remain,  attempts  to  restrain  combination  will 
be  futile. 

Trusts  have  little  dread  of  statute  law  which  the  court 
will  take  years  to  interpret.  They  fear  the  repeal  of  priv- 
ilege, and  ‘^‘^Eepeaf^  should  be  the  battle  cry  of  those  who 
believe  in  equal  rights  before  the  law. 


TRUSTS — PRO  AND  CON, 


53 


THE  TARIFF  THE  MOTHER  OF  TRUSTS. 


BYRON  W.  HOLT. 

The  next  speaker  was  Byron  W.  Holt  of  the  New  York 
Free  Traders^  League.  He  said: 

When  H.  0.  Havemeyer  last  June  startled  the  country 
with  the  declaration  before  the  industrial  commission  that 
the  mother  of  all  trusts  is  the  customs  tariff  bill^  he  came 
so  near  telling  the  truth  that  the  protectionist  organs  of 
the  country  immediately  began  calling  him  names  and 
saying  ‘^‘^sour  grapes/^  and  the  organ  of  the  Protective  Tar- 
iff League  is  still  devoting  a large  portion  of  its  space  to 
the  wicked^  traitorous  Havemeyer.  If  he  had  said  that 
special  privileges,  of  which  the  tariff  is  foremost,  are  the 
mother  of  trusts,  he  would  have  been  still  nearer  the  truth. 

That  the  tariff  by  shielding  our  manufacturers  from  for- 
eign competition  makes  it  easy  for  them  to  combine,  to  re- 
strict production  and  to  fix  prices — up  to  the  tariff  limit — 
ought  to  be  evident  to  every  intelligent  man.  It  ought 
also  to  be  evident  to  all  here  that  the  greatest  objection 
to  trusts  is  due  to  their  ability  to  raise  prices  above  a nor- 
mal, profit-producing  point.  That  the  trusts  raise  prices 
whenever  possible  to  what  they  consider  the  maximum 
profit  point  is  certain.  It  is  asserted  by  the  trusts^  advo- 
cates that  trusts  can  produce  more  cheaply  than  individual 
firms,  and  that  they  have  lowered  prices.  It  may  be  true 
tliat  trusts  usually  produce  more  cheaply,  but  it  is  cer- 
tainly not  true  that  they  have  lowered  prices.  Out  of  400 
trusts  which  I have  enumerated  I do  not  believe  ten  have 
lowered  prices.  In  fact,  I know  of  only  one  or  two,  and 
these  have  lowered  the  quality  of  the  product.  In  nine 
cases  out  of  ten  trusts  have  raised  prices — often  more  than 
50  per  cent.  That  much  of  the  present  rise  in  prices  is 
due  to  general  economic  conditions  is  probably  true.  On 


54 


TRUSTS — PRO  AND  CON. 


the  other  hand^  it  is  just  as  true  that^  had  there  been  no 
tariff  duties,  the  rise  in  prices  would  neither  have  been  so 
general  nor  so  great.  The  trusts  have  taken  full  advantage 
of  the  powers  and  special  privileges  derived  from  their 
tariff  partner — the  government.  Congress  should  speedily 
dissolve  this  iniquitous  partnership. 

IN  TIN  PLATE  INDUSTEY. 

If  there  is  one  industry  more  than  any  other  to  which 
the  protectionists  have  always  ^^pointed  with  pride/’  it  is 
the  American  tin  plate  industry.  There  are  two  points  of 
view — that  of  the  manufacturer  and  that  of  the  consumer. 
To  the  manufacturer  everything  looks  lovely.  He  asked  to 
have  2 1-5  cents  a pound  duty  added  to  the  price  of  im- 
ported tin  plate  until  he  could  experiment  to  see  if  he  could 
make  it  at  a profit  at  about  double  the  price  of  foreign  tin 
plate.  McKinley  granted  the  request,  and  the  experiment 
began  and  was  rendered  successful  largely  through  the  aid 
X)f  cheap  iron  and  steel  from  1893  to  1898.  The  profits  of 
the  tin  plate  manufacturers  were  great,  and  by  1897  we 
were  maldng  half  the  plates  consumed  in  this  country. 

In  1897  the  duty  was  gratuitously  raised  to  1^  cents  a 
pound,  and  by  1898  the  great  profits  of  the  business  had 
increased  the  num^ber  of  tin  plate  plants  to  about  forty 
and  the  number  of  mills  to  about  280,  and  few  plates  were 
imported,  and  internal  competition  had  so  lowered  prices 
that  our  manufacturers  were  not  reaping  the  full  benefit 
of  the  duties  levied  especially  for  their  benefit.  This  situ- 
ation worried  the  manufacturers,  and  they  formed  a com- 
pact, air-tight  monopoly,  which  is  a credit  to  its  mother — 
the  tariff.  To  make  certain  that  they  would  be  able  to 
hold  prices  up  to  the  Dingley  duty  limit  they  formed  five- 
year  contracts  with  the  producers  of  tin  plate  which  prac- 
tically prevents  others  from  starting  in  the  business  during 
this  period.  They  also  obtained  control  of  the  principal 
raw  material,  thus  further  preventing  outside  competition, 
so  there  is  practically  no  competition  at  present,  nor  is 
there  likely  to  be  while  the  present  duty  is  in  force.  The 
plants  and  mills  in  this  trust  are  worth  about  $12,000,000, 
and  the  trust  is  capitalized  at  $50,000,000,  on  which  big 
dividends  will  probably  be  paid. 


TRUSTS — PRO  AND  CON. 


55 


PICTUEE  BEFORE  CONSUMER. 

The  consumer  sees  a different  picture.  He  saw  prices 
held  up  by  duties  until  the  tin-plate  infant  was  full  grown 
and  capable  of  giving  him  cheap  tin  plate^  and  now  he 
sees  them  held  up  by  means  of  a monopoly  and  what  he 
considers  an  iniquitous  tariff.  He  is  getting  out  of  pa- 
tience with  the  youngster^  and  threatens  to  cut  off  his  sup- 
ply of  tariff  food  and  let  him  shift  for  himself.  The  pro- 
tectionists bravely  tell  us  that  the  tin  plate  tax  is  paid  by 
the  foreigner^  and  that  if  we  were  not  producing  our  own 
tin  plate  the  Welsh  trust  would  be  charging  us  just  as 
much  as  are  our  own  manufacturers.  The  fact  that  prices 
went  up  under  the  McKinley  duty,  down  under  the  Wilson 
dut}^  and  up  again  under  the  Dingley  duty  upsets  the 
plausibility  of  this  theory. 

The  only  way  in  which  tariff  duties  can  benefit  labor  is 
through  a double  trust,  composed  of  both  manufacturers 
and  their  employes,  and  this  has  been  formed  only  tem- 
porarily and  in  a few  industries,  notably  in  that  of  window 
glass.  Even  in  this  it  is  doubtful  if  the  employes,  as  a 
whole,  got  much  of  the  tariff  benefits,  as  what  they  gained 
in  higher  wages  was  lost  through  lack  of  employment  when 
mills  were  closed  for  the  purpose  of  restricting  production 
and  raising  prices. 

Nearly  all  kinds  of  manufactured  goods  are  sold  at  con- 
siderably reduced  prices  when  for  export.  American  bi- 
cycles, typewriters,  sewing  machines^  and  so  forth  sell  in 
foreign  countries  at  much  less  than  in  North  America.  To 
appreciate  fully  the  beneficent  effects  of  American  tariffs 
and  trusts  you  must  be  a foreigner. 

The  heart  of  the  trust  problem  is  in  our  tariff  system  of 
plunder.  The  quickest  way  and  most  certain  way  of  reach- 
ing the  evil  of  trusts  is  by  the  abolition  of  tariff  duties. 
Let  Congress  take  up  the  Dockery  amendment  to  the  Ding- 
ley  bill,  and  if  there  is  any  likelihood  that  it  will  pass,  the 
lobbies  at  Washington  will  be  filled  with  trust  directors  and 
agents.  Let  a constitutional  amendment  be  proposed  and 
the  trusts  will  take  only  a passing  interest  in  the  discus- 
sion. They  care  little  for  legislation  or  constitution,  but 
they  have  a mortal  fear  of  free  trade. 


56 


TRUSTS — PRO  AND  CON. 


TAB  IFF  DOES  NOT  FA  VOB  TRUSTS. 


JOHN  F.  SCANLAN. 

The  discussion  of  ^Tariff  and  trusts^^  was  continued  by 
John  P.  Scanlan^  of  Chicago.  He  said  in  part: 

To  charge  the  existence  of  trusts  to  protective  tariff 
is  as  ridiculous  as  to  charge  them  to  the  existence  of  hu- 
man life;  if  there  were  no  human  life  on  this  continent 
there  v/ould  be  no  trusts,  except  the  universal  trust  of 
death.  Why  not,  then,  charge  the  new  creation  of  man’s 
energy  to  the  existence  of  original  life,  and  not  to  one  of 
the  agents  of  industrial  life — ^the  tariff.  I presume  our 
free-trade  friends  feel  that  it  would  not  serve  the  interests 
of  foreign  industries,  hence  they  adopt  the  latest  dema- 
gogue craze,  with  the  hope  of  enlisting  the  unthinking  by 
crying  out:  ^‘^The  tariff  is  the  mother  of  trusts.” 

If  our  free-trade  friends  mean  that  the  tariff  is  the  source 
of  our  great  wealth  and  prosperity  out  of  which  has  grown 
new  conditions  under  which  man’s  selfishness  and  cupidity 
combine  to  sidetrack  the  spirit  of  our  government — the 
greatest  good  to  the  largest  number — if  they  desire  to  pay 
to  the  tariff  this  creative  compliment,  I doff  my  hat  to  their 
wisdom  and  assert  that  were  it  not  for  the  tariffs  that  held 
up  the  arm  of  the  government  in  the  dark  days  of  the  re- 
bellion we  would  have  no  United  States.  During  indus- 
trial panics — always  brought  on  by  changing  our  tariff  laws 
— you  will  find  that: 

1.  Our  industries  were  suspended. 

2.  Labor  was  idle,  rebellious  and  fed  at  soup-houses. 

3.  Great  increase  of  commercial  bankruptcy. 

4.  Government  revenue  less  than  expenditures. 

5.  Gold  leaves  the  country  in  vast  quantities. 

6.  Consuming  power  of  the  home  market  greatly  re- 
duced. 

The  return  to  the  American  system  as  regularly  brings 


TRUSTS — PRO  AND  COISr. 


57 


about  exactly  reversed  conditions  in  each  item  above 
quoted. 

The  speaker  then  referred  to  the  trouble  brought  about 
by  the  failure  of  the  old  federation  from  1783  to  1791  to 
provide  means  for  the  government  to  collect  revenue^  im- 
pose tariffs  or  encourage  home  industry  and  the  constant 
increase  of  prosperity  since  the  time  the  first  protective 
tariff  law  was  passed.  The  financial  history  of  the  country 
from  1800  to  1850  was  outlined  by  the  speaker  in  support 
of  his  argument. 

In  1850  we  numbered  23^000^000  inhabitants,  were  in 
the  seventy-fifth  year  of  our  national  freedom,  had  just 
secured  control  of  the  Pacific  coast  and  in  1857  had  dug 
out  of  the  California  mines  $1,100,000,000.  The  soil  was 
literally  bursting  with  fruitfulness.  It  was  the  design  of 
Providence  to  preserve  the  life  of  the  nation,  but  man’s 
unwisdom  put  it  aside,  and  by  1866  almost  every  dollar  of 
that  gold  had  left  the  country.  Free  trade  banished  it. 
Our  gold  made  England  the  clearing-house  of  the  world, 
and  the  crime  of  the  century  was  committed  when,  through 
free  trade,  we  were  deprived  of  the  results  of  the  rich  con- 
ditions which  existed  here  in  the  ’50s.  At  the  opening 
of  the  Civil  war  we  had  no  ships,  no  money,  no  credit,  no 
factories.  During  the  war  we  equipped  2,778,304  soldiers, 
built  700  ships  of  war  and  expended  $6,000,000,000.  When 
we  got  through  we  were  richer  than  when  we  commenced; 
were  able  to  pay  good  wages  to  the  soldiers  and  the  former 
slaves,  and  to  have  the  protective  tariff  to  thank  for  these 
marvelous  results. 

A ten-line  resolution  passed  by  Congress  in  1872  reduc- 
ing tariff  10  per  cent  brought  on  the  panic  of  1873.  The 
election  of  one  of  the  political  parties  pledged  to  radical 
free  trade  brought  on  the  panic  of  1893. 

From  1862  to  1892  this  nation  brought  into  existence 
more  original  wealth  than  the  entire  wealth  of  England, 
and  more  than  enough  of  wealth  to  purchase  all  the  lands, 
all  the  houses,  ships  and  personal  property  of  Germany. 
The  bringing  into  existence  of  that  vast  sum  in  one  gen- 
eration, controlled  by  the  American  people,  who  are  human 
like  the  rest  of  mankind,  necessarily  develops  the  spirit  of 
Alexander,  who  looked  for  more  worlds  to  conquer.  To 


58 


TRUSTS — PRO  AND  CON. 


be  rich  beyond  precedent  is  a craze^  a species  of  insanity; 
insanity  is  not  held  responsible  by  God  or  man,  but  it  is 
subject  to  law.  Give  the  American  people  limited  time, 
and  if  trusts  should  prove  to  be  against  the  interests  of  the 
majority  the  law  will  harness  them  to  the  people’s  interest, 
not  by  killing  the  poor  that  laid  the  golden  eggs,  but  by 
regulating  them. 

The  slave  trust  was  the  most  rapacious,  grasping  com- 
bination this  world  ever  saw,  but  the  American  people 
awakened  and  the  slave  trust  went  to  the  grave  of  the 
dead.  Its  very  cost  is  the  best  argument  that  the  people 
will  not  permit  any  combination  on  earth  to  interfere  with 
the  mission  of  the  republic.  The  creators  of  trusts  are 
establishing  the  most  gigantic  schools  of  socialism  the 
world  has  ever  known.  If  a few  men  can  run  all  the  in- 
dustrial interests  of  the  nation  why  cannot  all  the  people? 

Let  us  follow  the  example  of  Christ.  Let  us  lash  those 
out  of  the  temples  who  would  make  them  dens  of  thieves. 
Bring  them  within  the  law  and  let  our  fountains  of  per- 
petual wealth  continue  to  flow  from  the  industrial  centers 
of  our  republic  until  the  aroma  of  the  results  of  our  law, 
labor,  confidence  and  happiness  will  attract  the  attention  of 
other  nations  and  induce  them  to  do  as  our  fathers  did: 
establish  government  of  the  people,  for  the  people  and 
by  the  people.” 


TARIFF  OR  TRUSTS,  WHICH? 


HON.  THOMAS  UPDEGRAFP. 

The  tariff  discussion  was  carried  on  by  Congressman  Up- 
degraff,  of  Iowa.  He  said  in  part: 

I am  not  going  into  a speech  in  defense  of  protection. 
That  is  too  late.  I draw  the  line  there.  If  the  last  seven 
years’  experience  of  the  American  people  has  not  taught 
them  better  than  the  doctrines  that  have  been  read  from 
this  stand,  God  help  the  American  people.  The  American 
people  have  read  the  lesson,  and  it  is  not  to  be  forgotten, 
and  whoever  raises  his  voice  now  before  an  American  audi- 


TRUSTS — PRO  AND  CON. 


59 


ence  in  defense  of  free  trade  labors  in  vain.  The  head  of 
the  trust  that  is  making  more  money  out  of  the  pockets  of 
the  people  than  any  other  trust  was  introduced  as  a wit- 
ness, and  the  speaker  says  he  testified  on  his  conscience 
and  honor  that  the  tariff  was  the  mother  of  trusts.  I 
thought  he  was  smarting  a little  with  resentment  because 
the  protectionists  had  not  given  him  enough  in  their  last 
bill. 

A monopolistic  trust  I am  against.  An  aggregation  of 
capital,  however  large,  properly  managed,  I am  for.  I 
don’t  care  whether  the  tariff  is  the  mother  of  trusts  or  not. 
That  don’t  touch  the  question.  If  the  tariff  be  in  any 
sense  the  mother  of  trusts,  what  will  you  do? 

I will  tell  you  what  we  will  do;  we  will  take  care  of  the 
mother  and  save  her;  we  will  raise  her  children  in  the  ad- 
monition and  nurture  of  the  Lord.  That  is  the  way  to 
manage  trusts.  Why,  bless  my  soul,  my  friends,  you  can- 
not have  rich  soil  without  weeds. 

Don’t  kill  the  goose  that  lays  the  golden  egg.  Save  the 
soil  and  kill  the  weeds.  That  there  are  abundant  reme- 
dies and  sufficient  remedies  by  which  these  aggregations  of 
capital  can  be  controlled,  and  made  subservient  to  the 
public  good,  I do  not  doubt;  and  whenever  the  American 
people  in  earnest  say  that  that  work  shall  be  done,  it  will 
be  done,  and  the  trusts  will  be  controlled,  and  we  will  save 
what  is  good  in  aggregations  of  capital  and  control  what 
is  bad. 


60 


TEITBTS — PBO  COK. 


have  adopted  criminal  practices  and  are  therefore  amenable 
to  the  criminal  laws.  The  trusts  constitute  a great  danger 
to  themselves  in  overcapitalization^  big  salaries  and  incom- 
petent management.  The  address  continued  as  follows: 

The  trust  exemplifies  in  a broad  field  of  action  a condi- 
tion which  prevails  in  every  cross-roads  village  throughout 
the  civilized  worlds  wherever  one  man  through  superior 
industry,  skill,  finesse  or  capital  may  have  gained  some  ad- 
vantages over  his  fellows.  It  is  the  highest  expression  of 
human  selfishness  as  applied  to  business  affairs.  It  is  on  a 
grand  scale  exactly  the  same  thing  that  every  man  of  en- 
terprise is  attempting  on  a smaller  scale. 

Unlawfully  conducted  the  trust  may  undertake  by  con- 
spiracy to  restrict  trade,  to  destroy  competition  and  to 
limit  production,  but  numberless  corporations  and  individ- 
uals are  doing  some  of  these  things  all  the  time,  and  have 
been  doing  so  for  years.  The  same  law  which  will  prove 
sufficient  if  invoked  against  a disorderly  vender  of  bananas 
who  by  main  force  drives  away  a competitor  will  be  poten- 
tial, if  honestly  enforced,  to  deal  with  every  lawless  com- 
bination of  capital. 

Before  instituting  prosecution,  however,  it  will  be  well 
to  consider  with  some  seriousness  the  fact  that  business 
methods  in  this  country,  whether  in  trades  unions  or  in 
combinations  of  capital,  are  not  wholly  idyllic.  The  man 
who  undertakes  to  work  when  a trade  union  decrees  that 
he  shall  not  work  is  likely  to  have  his  head  broken,  unless 
society  bravely  and  honestly  comes  to  his  defense,  as  it 
should. 

The  weak  will  suffer  at  the  hands  of  lawless  trusts  in 
the  same  manner  until  society,  through  its  proper  agents, 
comes  to  their  relief.  Its  failure  to  do  so  is  due  to  the 
popular  delusion  that  lawless  trusts  present  a new  phase  of 
crime,  whereas  the  new  and  novel  feature  that  they  pre- 
sent is  the  ability  and  the  willingness  to  corrupt  or  to  in- 
timidate the  people^s  servants.  The  lawless  trust  can  be 
proceeded  against  as  easily  and  as  effectively  as  a lawless 
individual  can  be,  and  it  would  be  so  proceeded  against 
were  it  not  for  its  corrupt  relations  with  politics  and  poli- 
ticians. 

Hence  the  problem  to  be  considered  in  connection  with 


TRUSTS — PRO  AND  CON. 


61 


unlawful  trusts  and  combinations  is  not  so  much  one  of 
undue  and  criminal  financial  energy  as  it  is  of  deplorable 
popular  and  official  weakness.  As  a result  of  the  appeals 
of  ignorant  and  crafty  demagogues,  who  lightly  assail  all 
progress  and  all  prosperity,  and  the  wretched  and  despair^ 
ing  preachments  of  socialistic  agitators,  wffio  find  no  rem- 
edy for  any  ill  except  in  their  own  miserable  process  of 
leveling,  too  many  Americans  have  lost  sight  of  the  fact 
that  the  first  requisite  in  a well-ordered  republic  is  a self- 
reliant,  self-respecting  citizenship. 

It  is  not  remarkable  that  we  have  lost  some  sturdiness 
of  character  of  late,  for  we  have  pursued  many  false  ideas 
as  zealously  as  we  formerly  adhered  to  the  wiser  ones. 
Forty  years  of  protective  tariff  legislative  hypocrisy  and 
deception  have  taught  the  average  American  that  a wise 
man,  before  entering  upon  any  important  enterprise,  se- 
cures a favoring  law  or  privilege  or  franchise  at  the  hands 
of  government — local,  state  or  federal. 

The  upholding  of  this  doctrine  has  educated  a genera- 
tion of  Americans  to  the  belief  that  there  is  nothing  dis- 
creditable in  asking  and  accepting  public  assistance.  Imi- 
tating our  conspicuous  public  dependents,  the  tariff  ben- 
eficiaries, we  find  in  every  walk  of  life  that  beggary  is  be- 
coming a great  profession,  followed  by  a mighty  host  made 
up  of  every  manner  of  men,  women  and  children. 

In  addition  to  our  pension  roll  of  nearly  1,000,000 
names,  we  have  several  millions  of  workingmen  who,  with 
their  families,  have  been  taught  that  except  as  govern- 
ment taxes  all  the  people  for  the  benefit  of  their  employers 
they  cannot  hope  for  work  or  wages.  We  have  also  a 
propaganda  of  helplessness  and  imbecility  carried  on  some- 
times in  the  name  of  democracy,  but  oftener  outside  of  its 
councils,  which  teaches  hostility  to  all  wealth  and  to  indi- 
vidual enterprise,  which  informs  the  young  falsely  and 
maliciously  that  every  avenue  of  promotion  is  closed  to 
them  and  which  offers  no  remedy  for  existing  ills  save  the 
enfeebling  and  destructive  ones  which  are  to  be  found  in 
socialism  and  anarchy. 

Under  such  conditions  who  can  wonder  that  every  ag- 
gregation of  capital,  no  matter  how  laudable,  is  viewed  by 
many  Americans  with  dissatisfaction  and  discontent,  or 


62 


TRUSTS — PRO  AND  CON. 


that  defiant  lawlessness  on  the  part  of  some  of  the  rich  and 
powerful  is  everywhere  helplessly  ignored?  To  enforce 
any  law  public  sentiment  is  needed.  To  maintain  a re- 
public in  respectable  form  it  is  necessary  that  a majority 
of  its  citizens  shall  be  self-sustaining  men  who  scorn  pau- 
perism^ who  detest  robbery  of  every  description  and  who 
have  sufficient  intelligence  and  individuality  to  detect  and 
repudiate  the  sophistry  of  socialism  as  well  as  to  meet  with 
proper  rebuke  the  fiercer  fanaticism  of  the  revolutionists. 

With  a citizenship  honestly  and  wisely  inspired  and  of- 
ficered there  would  be  no  more  reason  for  holding  a con- 
ference to  consider  how  to  deal  with  lawless  trusts  than 
there  would  be  to  assemble  a mass  meeting  for  the  purpose 
of  discussing  the  propriety  of  enforcing  the  laws  against 
house-breaking.  The  lawful  trust  would  be  permitted  to 
pursue  its  business  unlimited  as  a matter  of  course. 

The  need  of  an  invigorating  tonic  in  American  political, 
business  and  social  life  is  very  great.  The  want  of  it  is 
felt  on  every  hand  where  senseless  agitation  merely  for  the 
sake  of  agitation  embitters  the  old  and  discourages  the 
young,  where  the  corrupting  influence  of  the  dishonest 
rich  finds  a ready  response  on  the  part  of  the  vicious  poor\, 
where  demagogues  mislead  the  idle  and  careless  and  where 
designing  men  sow  the  seed  of  lawlessness  and  perhaps  re- 
volt. 

There  is  need  of  some  sturdy  response  to  the  numerous 
irresponsible  spokesmen  of  calamity  and  slander  who  have 
the  floor  at  all  seasons  and  whose  influence  upon  the 
thoughtless  and  inexperienced  is  far-reaching  and  danger- 
ous. There  is  need  in  every  section  of  the  country  of  more 
hopeful,  helpful  and  suggestive  leadership  and  less  of 
chronic  and  wholly  useless  lamentation. 


PROTECTION  OF  GRAIN  MARKETS. 


S.  H.  GREELEY. 

S.  IT.  Greeley  of  Chicago  was  the  first  speaker.  He  spoke 
on  ‘^‘^The  Protection  of  American  Grain  Markets  From 
Eailroad  and  Warehouse  Monopoly  and  the  Encourage- 


TKUSTS — PRO  AND  CON. 


63 
\ 

ment  of  Local  and  Terminal  Competition  for  the  Crops;^ 
and  claimed  the  Chicago  public  warehouse  combination’s 
policy  was  to  draw  all  grain  to  this  city^  to  mix  inferior 
grades  with  superior  grades,  to  depress  prices  and  hoard 
the  nation’s  product  of  cereals,  to  the  detriment  of  farmers 
and  all  other  American  markets.  In  conclusion  he  said: 

The  public  warehouse  monopoly  was  born  in  a railroad 
office.  Kailroads  are  the  ^^mother  of  trusts,”  special  rates 
of  freight  the  food  that  prolongs  their  existence.  I for 
one  have  no  fears  for  the  success  of  all  enterprises  of  a 
commercial  nature  when  our  merchants  can  depend  upon 
the  same  and  equal  terms  in  matters  of  transportation. 
If  you  scan  brie%  the  pages  of  our  national  history  and 
recall  taxation  without  representation,  imprisonment  of 
American  seamen,  protection  of  commerce,  human  slavery 
and  human  liberty  we  may  find  a few  parallels  which  sug- 
gest that  there  are  signs  in  the  times  in  which  we  live. 
The  autocracy  of  the  American  railway  furnishes  an  issue 
as  great  as  any  for  which  our  forefathers  considered  it 
necessary  to  fight,  but  let  us  hope  the  wisdom  of  modern 
high  ideals  will  solve  this  problem  on  the  line  of  true  Chris- 
tian civilization. 


FOREIGN  MARKETS  AND  AMERICAN 
SHIPPING. 


J.  C.  HANLEY. 

J.  C.  Hanley  of  St.  Paul,  representing  the  National 
Farmers’  Alliance  and  Industrial  Union  of  America,  came 
next.  He  spoke  on  ‘^Toreign  Markets  and  American  Ship- 
ping, with  Eegard  to  Agriculture.”  He  said  trusts  and 
combines  would  be  blessings  if  conducted  on  strict  com- 
petitive lines,  but  as  now  operated  they  constitute  a menace 
to  the  nation’s  existence.  He  thought  government  own- 
ership of  transportation  lines,  telegraph  and  telephone  sys- 
tems, lands,  mines,  etc.,  the  only  solution.  He  favored 
government  aid  in  building  up  trade  in  the  Orient,  saying: 

Let  us  consider  what  can  be  done  with  an  appropriation 
of  $25,000,000  annually.  Pay  a bounty  of  $2  per  ton  on 


64 


TKUSTS — PKO  AND  CON. 


all  freight  of  American  production  and  manufacture.  This 
to  apply  on  ships  of  10,000  tons  capacity,  two  of  which 
could  leave  our  shores  daily  300  days  each  year,  giving  us 
6,000,000  tons  of  American  products  carried  in  American 
ships  to  foreign  markets.  This  would  be  $12,000,000. 
With  the  balance  $13,000,000  we  could  establish  permanent 
national  exhibits  of  American  products,  which  would  assist 
in  extending  our  trade  in  such  countries. 


AGRICULTURE  AWD  TRUSTS. 


AARON  JONES. 

Mr.  Jones,  of  South  Bend,  Indiana,  master  of  the  Na- 
tional Grange,  spoke  in  part  as  follows: 

Every  citizen  of  this  republic  should  be  free  to  use  his 
labor  as  will  best  contribute  to  his  benefit  and  happiness, 
not,  however,  infringing  on  the  rights  of  any  other  citizen. 
The  right  to  acquire,  own,  control  and  enjoy  the  use  and 
income  of  property  is  an  inalienable  right  that  should  be 
enjoyed  by  each  individual,  and  governments  are  organ- 
ized and  laws  enacted  better  to  protect  life,  liberty  and 
the  ownership  and  use  of  property. 

The  tendency  of  the  times  is  to  concentrate  business  in 
the  hands  of  a few.  As  the  demand  for  concentration  of 
business  increased  beyond  individuals  and  partnerships, 
the  law  provided  for  the  formation  of  corporations  to  con- 
duct certain  lines  of  business,  and  states  granted  them 
charters,  with  certain  defined  privileges.  These  corpora- 
tions serve  a useful  purpose,  but  within  the  last  two  years 
the  ambitions  of  men  to  acquire  power  and  wealth  rapidly 
have  caused  these  corporations  to  be  consolidated,  one  cor- 
poration being  formed  from  many  separate  corporations 
in  one  or  several  states.  It  has  been  found  that  the  in- 
creased power  of  these  trusts  has  caused  them  to  infringe 
on  the  rights  of  individuals,  destroy  the  value  of  other 
property  and  deprive  other  individuals  of  the  use  of  capital 
and  their  labor.  So  far  as  this  has  been  done  it  is  dearly 
against  public  policy. 


TKUSTS — PRO  AND  CON. 


65 


It  occurs  to  me  that  the  first  step  to  be  taken  in  remedial 
legislation  is  for  the  Congress  of  the  United  States  to  pass 
a well-considered  anti-trust  law  defining  the  powers  and 
limiting  the  privileges  of  these  corporations.  And  supple- 
ment this  law  by  enactments  of  the  several  state  legis- 
latures to  apply  to  such  phases  of  the  matter  as  could  not 
be  reached  by  the  United  States  law.  It  would  seem  that 
these  laws  should  provide  for  government  and  state  in- 
spection of  the  business  of  trusts,  of  their  books,  agree- 
ments, receipts  and  expenditures.  This  inspection  should 
be  rigid  and  full,  and  the  rights  of  the  public  should  be 
protected.  If  the  corporations  are  conducting  a legitimate 
business  no  injury  will  be  done  them  by  inspection.  They 
are  using  the  powers  granted  them  by  the  state  to  crush 
other  enterprises  or  for  illegitimate  political  purposes. 
These  practices  are  most  reprehensible  and  should  be  pun- 
ished by  such  penalties  as  will  effectually  stop  them. 
These  practices  most  seriously  and  injuriously  affect  the 
agricultural  interests  of  our  country,  and  they  demand 
that  national  and  state  laws  be  passed  which  will  prevent 
the  injurious  practices  of  trusts  and  combinations. 


ANARCHISM  AND  TRUSTS. 


BENJAMIN  R.  TUCKER. 

The  afternoon  session  was  closed  by  Benjamin  E.  Tucker 
of  New  York.  He  said: 

I take  my  stand  on  these  propositions*  That  the  right  to 
cooperate  is  as  unquestionable  as  the  right  to  compete;  that 
the  right  to  compete  involves  the  right  to  refrain  from 
competition;  that  cooperation  is  often  a method  of  compe- 
tition, and  that  competition  is  always,  in  the  larger  view,  a 
method  of  cooperation;  that  each  is  a legitimate,  orderly, 
non-invasive  exercise  of  the  individual  will,  under  the  so- 
cial lav/  of  equal  liberty;  and  that  any  man  or  institution 
attempting  to  prohibit  or  restrict  either,  by  legislative  en- 
actment or  by  any  form  of  invasive  force,  is,  insofar  as 


66 


TRUSTS — PRO  AND  CON. 


such  man  or  institution  may  fairly  be  judged  by  such  at- 
tempt, an  enemy  of  the  human  race. 

To  assail,  or  control,  or  deny  this  form  of  cooperation  on 
the  ground  that  it  is  itself  a denial  of  competition  is  an 
absurdity.  The  trust  denies  competition  only  by  produc- 
ing and  selling  more  cheaply  than  those  outside  of  the 
trust.  In  that  sense  every  successful  individual  competitor 
also  denies  competition.  And  if  the  trust  is  to  be  sup- 
pressed for  such  denial  of  competition,  then  the  competi- 
tion in  the  name  of  which  the  trust  is  to  be  suppressed 
must  itself  be  suppressed  also.  None  of  us  has  a right  to 
deny  competition. 

Of  the  banking  monopoly,  the  land  monopoly,  the  tariff 
monopoly,  and  the  patent  and  copyright  monopoly,  the 
injustice  of  all  but  the  last  named  is  manifest  even  to  a 
child.  For  the  fourth  of  these  monopolies,  however,  sets 
up  an  analogy  between  the  production  of  material  things 
and  the  productions  of  abstractions;  and  on  the  strength 
of  it  declares  that  the  manufacturer  of  mental  products  is 
a laborer  worthy  of  his  hire. 

Perpetual  property  in  ideas,  which  is  the  logical  out- 
come of  any  theory  of  property  in  abstract  things,  had  it 
been  in  force  in  the  lifetime  of  the  inventor  of  the  Eoman 
alphabet,  would  have  made  nearly  all  of  the  highly-civilized 
peoples  of  the  earth  to-day  the  virtual  slaves  of  that  in- 
ventor’s heirs.  It  seems  to  me  that  this,  which,  in  my 
view,  is  incontrovertible,  is  in  itself  sufficient  to  condemn 
property  in  ideas  forever. 

The  most  serious  of  these  four  monopolies  is  the  money 
monopoly,  and  I believe  that  perfect  freedom  in  finance 
alone  would  wipe  out  nearly  all  the  trusts,  or  at  least  ren- 
der them  harmless.  The  money  trust  cannot  be  destroyed 
by  the  remonetization  of  silver.  It  can  be  abolished  only 
by  monetizing  all  wealth  that  has  a market  value — that  is, 
by  giving  to  all  wealth  the  right  of  representation  by  cur- 
rency, and  to  all  currency  the  right  to  circulate  wherever 
it  can  on  its  own  merit^s. 

Anarchy  wants  to  call  off  the  quacks  and  give  liberty, 
nature’s  great  cure-all,  a chance  to  do  its  perfect  work. 

Free  access  to  the  world  of  matter,  abolishing  land  mo- 
nopoly; free  access  to  the  world  of  mind,  abolishing  idea 


TRUSTS — PRO  AND  CON. 


67 


monopoly;  free  access  to  an  nntaxed  and  unprivileged 
market,  abolishing  tariff  monopoly  and  money  monopoly — 
secure  these,  and  all  the  rest  shall  be  added  unto  you.  For 
liberty  is  the  remedy  of  every  social  evil,  and  to  Anarchy 
must  the  world  look  at  last  for  any  enduring  guarantee  of 
social  order. 


TBUSTS  AND  OUR  NATIONAL  LIFE  AND 
CITIZENSHIP. 


GOVERNOR  H.  S.  PINGREE. 

Governor  Pingree  of  Michigan  opened  the  debate  in  the 
evening  with  an  address  on  ^^The  Effect  of  Trusts  Upon 
Our  National  Life  and  Citizenship.^^  He  was  epigram- 
matic rather  than  argumentative,  saying: 

The  trust  is  the  forerunner,  or  rather  the  creator  of  in- 
dustrial slavery. 

In  all  that  has  been  said  about  trusts,  he  said,  scarcely  a 
word  has  been  written  or  spoken  from  the  standpoint  of 
their  effect  on  society.  In  gathering  material  for  the  use 
of  this  conference  the  Civic  federation  sent  out  circulars 
containing,  in  all,  sixty-nine  questions.  Those  inquiries 
were  addressed  to  trusts,  wholesale  dealers,  commercial 
travelers’  organizations,  railroads,  labor  associations,  con- 
tractors, manufacturers,  economists,  financiers,  and  public 
men.  Only  one  of  these  sixty-nine  questions  related  in 
any  way  to  the  effect  of  ^Trusts”  upon  society.  I think 
that  this  is  the  most  important  consideration  of  all. 

MONEY  THE  SOLE  CONSIDEEATION. 

Everybody  has  been  asking  whether  more  money  can  be 
made  by  trusts  than  by  small  corporations  and  individuals 
— whether  cost  of  production  will  be  increased  or  de- 
creased; whether  investors  will  be  benefited  or  injured; 
whether  the  financial  system  of  the  country  will  be  en- 
dangered; whether  we  can  better  compete  for  the  world’s 
trade  with  large  combinations  or  trusts;  whether  prices 
will  be  raised  or  lowered;  whether  men  will  be  thrown  out 


68 


TKUSTS — PRO  AND  CON. 


SCENE  IN  THE  TRUST  CONFERENCE  DURING  GOV.  PINGREPS  ADDRESS. 


Ex-Governor  Foster 
of  Ohio. 


Governor  Pingree 
speaking. 


—From  The  Chicago  Record, 


TRUSTS — PRO  AND  CON. 


69 


of  employment;  whether  wages  will  be  higher  or  lower; 
whether  stricter  economy  can  be  enforced^  and  so  on. 

In  other  words,  the  only  idea  nowadays  seems  to  be  to 
find  out  how  business  or  commerce  wfill  be  affected  by 
trusts.  The  almighty  dollar  is  the  sole  consideration. 

I believe  that  all  these  things  are  minor  considerations. 
I think  it  is  of  far  greater  importance  to  inquire  whether 
the  control  of  the  world^s  trade,  or  any  of  the  other  com- 
mercial advantages  claimed  for  the  trusts,  are  worth  the 
price  we  pay  for  them. 

Will  it  pay  us,  either  as  individuals  or  as  a nation,  to  en- 
courage trusts? 

Instead  of  discussing  the  question  from  the  standpoint 
of  commercial  gain,  let  us  view  it  as  patriots.  I believe 
that  a conference  of  this  kind  should  not  attempt  to  judge 
a question  so  important  to  our  national  welfare  as  this  by 
the  selfish  standard  of  commercial  greed.  I think  that 
loftier  motives  should  rule  us  in  this  discussion. 

CLASSES  BASED  ON  WEALTH. 

In  this  republic  of  ours  we  are  fond  of  saying  that  there 
are  no  classes.  In  fact,  we  boast  of  it.  We  say  that 
classes  belong  to  monarchies,  not  to  republics. 

Nevertheless  none  of  us  can  dispute  the  fact  that  our 
society  is  divided  into  classes,,  and  well-defined  ones,  too. 
They  are  not  distinguished  by  differences  of  social  stand- 
ing. That  is,  we  have  no  aristocratic  titles,  no  nobility. 
The  distinction  with  us  is  based  upon  wealth.  The  man  is 
rated  by  the  property  he  owns.  Our  social  and  political 
leaders  and  speakers  deny  this.  In  doing  so,  however,  they 
ignore  actual  conditions.  They  discuss  what  ought  to  be 
under  our  form  of  government — ^not  what  is. 

The  strength  of  our  republic  has  always  been  in  what  is 
called  our  middle  class.  This  is  made  up  of  manufactur- 
ers, jobbers,  middlemen,  retail  and  wholesale  merchants, 
commercial  travelers  and  business  men  generally.  It 
would  be  little  short  of  calamity  to  encourage  any  indus- 
trial development  that  would  affect  unfavorably  this  im- 
portant class  of  our  citizens.  Close  to  them,  as  a strong 
element  of  our  people,  are  the  skilled  mechanics  and  arti- 
sans. They  are  the  sinew  and  strength  of  the  nation. 


TRUSTS — PRO  AND  CON. 


STIMULUS  TO  AMBITION. 

While  the  business  of  the  country  has  been  conducted  by 
persons  and  firms^  the  skilled  employe  has  held  close  and 
sympathetic  relations  with  his  employer.  He  has  been 
something  more  than  a mere  machine.  He  has  felt  the 
stimulus  and  ambition  which  goes  with  equality  of  oppor- 
tunity. These  have  contributed  to  make  him  a good  citi- 
zen. Take  away  that  stimulus  and  ambition  and  we  lower 
the  standard  of  our  citizenship.  Without  good  citizenship 
our  national  life  is  in  danger. 

It  seems  to  me^  therefore^  that  the  vital  consideration 
connected  with  this  problem  of  the  trust  is  its  effect  upon 
our  middle  class — the  independent  individual  business  man 
and  the  skilled  artisan  and  mechanic.  How  does  the  trust 
affect  them?  It  is  admitted  by  the  apologist  for  the  trust 
that  it  makes  it  impossible  for  the  individual  or  firm  to 
do  business  on  a small  scale.  It  tends  to  concentrate  the 
ownership  and  management  of  all  lines  of  business  activity 
into  the  hands  of  a very  few.  No  one  denies  this. 

KILLS  INVENTIVE  GENIUS. 

A very  select  few  may  become  heads  of  trusts,  but  such 
opportunities  will  be  rare  indeed.  They  will,  therefore,  be 
entirely  useless  as  incentives  to  the  ambition  of  the  army  of 
those  employed  by  the  trusts.  As  a result  of  the  ceaseless 
and  heartless  grind  of  the  trusts  in  the  almost  insane  desire 
to  control  trade,  ambition  and  perhaps  inventive  genius 
will  be  deadened  and  killed. 

The  trust  is  therefore  the  forerunnner,  or  rather  the 
creator,  of  industrial  slavery.  The  master  is  the  trust 
manager  or  director.  It  is  his  duty  to  serve  the  soulless 
and  nameless  being  called  the  stockholder*  To  the  latter 
the  dividend  is  more  important  than  the  happiness  or  the 
prosperity  of  any  one.  The  slave  is  the  former  merchant 
and  business  man  and  the  artisan  and  mechanic,  who  once 
cherished  the  hope  that  they  might  some  time  reach  the 
happy  position  of  independent  ownership  of  a business. 

TEUST  MANAGER  A FEUDAL  BARON. 

Commercial  feudalism  is  the  logical  outcome  of  the 
trust.  The  trust  manager  is  the  feudal  baron. 


TRUSTS — PRO  AND  CON. 


71 


These  may  perhaps  be  harsh  characterizations,  but  who 
can  deny  their  truth?  Honesty  to  ourselves  and  loyalty  to 
our  country  and  its  free  institutions  compel  us  to  face  and 
recognize  the  situation. 

We  cannot  be  true  to  our  republic  by  ignoring  these 
things.  We  cannot  be  honest  to  the  people,  either  at  this 
conference  or  in  our  legislative  assemblies,  by  confining 
our  deliberations  to  the  commercial  advantages  and  disad- 
vantages of  the  trust. 

It  is  better  to  be  forever  poor,  but  independent  and  hap- 
py as  individuals,  than  to  lay  the  foundations  for  industrial 
tyranny  and  slavery.  Personal  liberty  is  rather  to  be 
chosen  than  great  riches.  Equality  of  opportunity  to  all 
men  is  better  than  the  control  of  the  world^s  trade. 

The  effect  of  the  trust  upon  our  national  life  and  our 
citizenship  will  not  be  sudden,  perhaps.  It  will  rather  be 
a silent  and  gradual  change.  It  may  not  be  observed  at 
once,  but  its  influence  will  nevertheless  be  felt. 

WAENING  MAY  HOT  BE  HEEDED. 

The  warning  with  which  the  history  of  the  decadence 
and  downfall  of  other  nations  furnishes  us  may  not  be 
heeded  now.  If  not,  we  may  pay  the  usual  penalty  of 
slavery  to  commercial  avarice  and  greed. 

Increase  of  the  wealth  of  the  country  is  greatly  to  be 
desired,  but  if  the  people  are  to  be  degraded  to  industrial 
slavery,  wealth  under  such  conditions  is  a curse.  If  our 
independent  and  intelligent  business  men  and  artisans  are 
to  be  crowded  out  of  existence  as  a class  by  the  trust,  there 
is  no  remedy  too  drastic  for  the  trust. 

Some  may  think  it  too  early  to  sound  a note  of  warning 
of  this  kind,  but  the  time  to  check  an  evil  tendency  is  when 
it  first  shows  itself. 

IMMEDIATE  ACTIOH  NECESSAEY. 

We  have  given  the  private  corporation  ^Too  much  rope.^^ 
Some  say  give  it  more  rope  and  it  will  hang  itself.  In 
other  words,  they  claim  that  the  trust  problem,  if  left 
alone,  will  work  out  its  own  solution.  I do  not  believe  in 
such  a policy.  There  is  too  much  at  stake.  The  most  im- 
portant element  of  our  citizenship  is  in  the  balance.  We 


72 


TRUSTS — PRO  AR^D  CON. 


cannot  afford  to  sap  the  strength  of  our  democracy  in  order 
to  forward  an  experiment. 

I favor  complete  and  prompt  annihilation  of  the  trust — 
with  due  regard  for  property  rights^  of  course. 

I care  more  for  the  independence  and  manliness  of  the 
American  citizen  than  for  all  the  gold  or  silver  in  the 
world.  It  is  better  to  cherish  the  happiness  of  the  Ameri- 
can home  than  to  control  the  commerce  of  the  globe. 

The  degrading  process  of  the  trust  means  much  to  the 
future  of  a republic  founded  upon  democratic  principles. 
A democratic  republic  cannot  survive  the  disappearance  of 
a democratic  population. 


TBUSTS  HA  VE  COME  TO  STAY. 


HON.  CHARLES  W.  FOSTER. 

Governor  Pingree  was  followed  by  Hon.  Charles  W. 
Foster,  of  Ohio,  who  said  in  part: 

The  gentleman  from  Texas  yesterday  stated  that  his 
State  had  no  industrial  development,  that  it  sold  raw  ma- 
terial and  bought  its  supplies,  as  the  reason  for  its  fierce 
opposition  to  trusts.  He  also  portrayed,  as  did  the  gen- 
tleman from  Michigan  before  me,  the  superiority  of  man- 
hood over  money. 

It  strikes  me  that  if  the  Texas  people  had  sufficient  en- 
terprise to  establish  industries,  to  consume  their  cotton, 
wool  and  other  raw  material,  their  manhood  would  not 
deteriorate,  their  opposition  to  trusts  would  be  less  vehe- 
ment, and  they  would  have  more  money. 

The  evolution  in  business  from  the  individual  to  the 
partnership,  and  from  the  partnership  to  the  corporation, 
was  no  more  natural  and  necessary  than  is  the  evolution 
from  the  corporation  to  the  trust.  Let  us  look  the  situa- 
tion squarely  in  the  face.  Denounce  it  as  we  may,  it  has 
come  to  stay.  Why?  Because  the  gigantic  business  oper- 
ations of  the  present  and  future  cannot  be  carried  on  with- 
out it. 


TEUSTS — PEO  AND  CON. 


73 


SAVES  ENOEMOUS  WASTE. 

Through  the  trust  the  enormous  waste  that  is  entailed 
upon  business  operations  by  competition  is  saved;  the 
product  and  the  service  performed  is  cheapened;  labor  will 
have  the  better  opportunity  to  enhance  wages  and  shorten 
the  hours  of  toil^,  as  is  so  signally  illustrated  in  the  railroad 
service  of  the  country.  Through  the  trust  the  superior 
inventive  genius  of  our  people  (because  of  universal  edu- 
cation) will  have  improved  opportunity. 

Have  no  fear  that  the  trusts  will  seriously  impose  upon 
the  people  in  the  prices  that  will  have  to  be  paid  for  their 
products.  The  germs  of  death  are  in  them^,  and  their  only 
method  to  prevent  an  early  demise  is  to  avoid  extortion. 

It  may  be  a debatable  question  whether  the  Standard 
Oil  Company  has  been  and  is  a blessing  to  the  country. 
Certain  it  is,  however,  that  it  has  developed  an  industry, 
in  something  more  than  thirty  years,  from  practically  noth- 
ing to  an  annual  volume  of  perhaps  more  than  $150,000,- 
000,  of  which  it  retains  about  $25,000,000  and  gives  $125,- 
000,000  to  the  people  of  the  country.  It  has  greatly  les- 
sened the  cost  of  light;  it  is  paying  more  than  $100,000,000 
annually  for  oil  and  labor,  and  pays  its  labor  more  than 
any  other  employees  receive.  It  has  added  more  than 
$1,000,000,000  to  the  wealth  of  the  country  and  con- 
tributes $60,000,000  a year  to  our  credit  in  its  exports. 

SHOULD  BE  CONTEOLLED  BY  LAW. 

But  there  are  reasons  for  the  control  of  trusts  by  law. 
Overcapitalization  must  be  guarded  against.  A bureau  of 
government  or  a board  similar  to  the  interstate  commerce 
commission  should  be  established,  to  which  all  trusts  shall 
apply  for  license,  after  being  incorporated,  and  to  which 
reports  as  exhaustive  as  is  required  of  the  national 
banks  should  be  made.  The  terms  of  the  license 
should  not  be  illiberal,  but  they  certainly  should  provide 
against  overcapitalization.  All  profits  beyond  6 per  cent 
should  be  taxed  for  the  benefit  of  the  government. 

As  probably  the  power  does  not  exist  in  Congress  to 
make  the  requirements  suggested,  it  seems,  then,  that  it  is 
the  plain  duty  of  this  conference  to  request  Congress  to 


74 


TRUSTS — PRO  AND  CON. 


submit  amendments  to  the  constitution  giving  it  necessary 
power  not  only  to  control  the  trusts,  but,  as  the  suggestion 
is  made,  to  tax  their  profits;  also  to  provide  for  an  income 

FAVOES  AFT  INCOME  TAX. 

It  is  evident  that  the  country  hereafter  must  rely  upon 
internal  taxation  for  revenue  to  support  the  government. 
An  income  tax  is  the  most  equitable  form  of  taxation  and 
can  be  paid  with  less  hardship  than  any  other. 

It  seems  to  me  that  as  both  those  who  oppose  and  those 
who  favor  trusts  are  in  accord  in  favoring  the  assertion  of  a 
power  strong  enough  to  either  destroy  or  regulate  them,  we 
ought  to  be  able  to  get  together  on  the  proposition  to 
amend  the  constitution  of  the  United  States.  Certainly 
we  ought  to  agree  to  an  amendment  prohibiting  the  use  of 
tariff  duties  to  enhance  prices. 

STATE  CONTEOL  INSUFFICIENT. 

I apprehend,  but  for  the  inherent  support  of  the  doctrine 
of  state  rights  by  "our  southern  friends,  the  proposition 
would  be  readily  agreed  to.  It  is  evident  that  the  states 
acting  independently  cannot  successfully  deal  with  this 
great  question.  As  the  country  expands  the  weakness  of 
state  control  of  great  questions  becomes  more  apparent, 
and  the  need  of  the  use  of  federal  power  becomes  greater. 

The  law  of  this  country  has  been  one  of  expansion  and 
growth,  and  I may  appropriately  say  that  when  we  cease  to 
grow  our  decline  will  begin.  I believe  the  great  mission 
designed  by  Providence  for  this  country  has  only  begun; 
that  it  will  go  on  evangelizing  and  civilizing  the  world  un- 
til all  lands  and  all  peoples  will  be  in  the  fall  enjoyment  of 
free  institutions. 


ABKAJVSAS  LAW  AS  APPLIED  TO  TRUSTS. 


HON.  JEFFERSON  DAVIS. 

Jefferson  Davis,  Attorney- General  of  Arkansas,  was  the 
next  speaker.  He  said  in  part: 

We  all  know  that  any  conspiracy  to  control  prices — and 


TEUSTS — PEO  AND  CON. 


75 


that  is  but  an  epitome  of  trusts — is  a crime  at  the  common 
law,  and  that  wherever  the  common  law  prevails  and  under 
that  alone  the  crime  of  conspiracy  to  control  prices  can  be 
punished  criminally.  It  is  not  of  the  legislative  depart- 
ment of  this  government  that  I would  complain,  but  of  the 
judicial  department.  I hold  in  my  hand  a copy  of  one 
of  the  best  laws  that  was  ever  enacted  in  a state  upon  the 
subject  of  trusts.  The  only  remedy  for  extermination  of 
the  trust  is  to  bring  upon  it  the  strong  arm  of  the  law. 
Arkansas  has  started  the  agitation,  but  Texas  went  us  one 
better,  and  Texas  has  to-day  possibly  a better  law  than 
that.  We  have  got  to  reconstruct  our  judiciary.  I am 
here  to  say  to  you  that  if  we  ever  have  another  civil  war — 
and  God  grant  we  may  not — it  will  be  brought  about,  in 
my  judgment,  by  judge-made  law.  I tell  you,  one  of  the 
greatest  evils  of  the  country  is  judge-made  law,  the  judi- 
ciary department  invading  the  department  of  the  legisla- 
tive. 


TRUSTS  PART  OF  PROGRESS. 


GEORGE  GUNTON. 

The  next  speaker  of  the  evening  was  George  Gunton  of 
New  York,  who  spoke  briefly.  He  said: 

The  trust  question  is  only  a new  phase  of  an  old  prob- 
lem, the  problem  of  free  industrial  enterprise.  Since  the 
dawn  of  the  factory  system  and  the  use  of  steam,  state 
regulation  of  industry  has  grown  more  and  more  incom- 
patible with  progress.  The  present  agitation  against 
trusts  has  all  the  characteristics  of  the  anti-machinery  riots 
of  a century  ago.  It  pervades  the  attitude  of  both  laborers 
and  business-men  alike.  Men  of  national  repute  and  lead- 
ers of  great  political  parties  are  asking  the  people  to  re- 
verse the  policy  of  industrial  freedom  and  return  to  the 
doctrine  of  arbitrary  paternalism,  specifically  to  suppress 
large  corporations.  Are  the  American  people  ready  for 
such  a step? 

Stripped  of  sensation,  political  partisanship,  and  class 
feeling,  the  movement  against  so-called  trusts  is  really  a 


76 


TRUSTS — PRO  AND  CON". 


movement  against  industrial  development  and  national 
prosperity,  and  is  a blow  to  the  growth  and  greatness  of 
the  nation. 


CONGBESS  SHOULD  CONTROL. 


HON.  G.  R.  GAITHER,  JR. 

Attorney  General  Gaither,  of  Maryland,  closed  the  sec- 
ond day  of  the  conference  with  a short  address  as  follows: 

The  control  and  direction  of  trusts  can  be  made  effective. 
The  inexorable  law  of  economics  that  values  must  inev- 
itably find  their  true  level  can  be  safely  relied  upon  to 
disintegrate  and  destroy  the  false  combinations  which  have 
been  formed,  and  the  creation  of  trusts  may  be  regarded 
as  only  a temporary  disturbance  of  the  business  world. 

Every  act  of  a trust  can  be  directed  by  the  law.  The 
propriety  of  a law  regulating  the  price  to  be  charged  for 
a commodity  cannot  be  questioned.  It  would  be  within 
the  province  of  Congress  to  ameliorate  the  present  semi- 
barbaric  relationship  between  great  corporations  and  their 
employes.  Again,  a wise  system  of  taxation  levied  on 
these  aggregations  of  wealth  would  afford  national  and 
municipal  funds  for  the  establishment  of  enterprises  for 
the  unemployed. 

The  control,  regulation,  and  direction  of  all  trusts, 
whose  business  is  carried  on  in  more  than  one  state,  should 
be  placed  under  the  jurisdiction  of  Congress.  A similar 
jurisdiction  over  such  combinations  operating  in  a single 
state  should  be  reposed  in  the  respective  state  legisla- 
tures. It  would  be  almost  suicidal  to  attempt  such  legis- 
lation under  the  present  constitutional  limitations.  Let 
us  cut  the  Gordian  knot  of  endless  constitutional  discus- 
sion by  adopting  immediately  an  amendment  to  the  fed- 
eral constitution  which  will  confer  the  broader  power  to 
deal  with  the  subject  upon  Congress  and  the  states  in 
their  respective  spheres. 


TilUSTS — PHO  AND  CON. 


77 


REVIEW  OE  SECOND  DATS  SESSION 


DR.  ALBERT  SHAW. 

The  second  day  of  the  conference  was  marked  by  the 
arrival  of  a considerable  number  of  men  of  influence  and 
prominence  from  various  states.  The  members  had  made 
good  progress  in  getting  acquainted  with  one  another, 
and  the  atmosphere  of  mutual  distrust  and  suspicion  which 
had  prevailed  to  some  extent  on  Wednesday  was  largely 
dispelled.  The  selection  of  John  W.  Gaines,  Kepresenta- 
five  in  Congress  from^  Tennessee,  as  chairman  of  the  sub- 
committee on  program  and  arrangements  was  wholly  ac- 
ceptable to  all  elements.  Mr.  Gaines,  like  his  associates 
on  that  committee,  readily  convinced  every  one  who  came 
in  contact  wuth  him  of  the  scrupulous  fairness  of  his  at- 
titude and  his  doctrine  to  do  all  that  he  could  to  make 
the  conference  instructive  by  reason  of  its  being  a free 
and  open  parliament  for  the  courteous  expression  of  every 
shade  of  opinion. 

The  public  speaking  of  the  conference  thus  far  has 
not  all  of  it  been  directly  to  the  point,  nor  has  it  all 
been  marked  by  the  highest  order  of  thoughtfulness.  But 
much  of  it  has  been  good,  considered  as  oratory,  and 
some  of  it  valuable  for  the  purposes  of  the  conference  in 
its  real  illumination  of  some  of  the  phases  of  the  pro- 
gram. A good  part  of  the  morning  session  was  taken  up 
on  a rather  futile  debate  on  the  question  of  whether  or 
not  there  should  be  appointed  a committee  on  resolutions. 

The  discussion  ended,  however,  in  something  like  en- 
tire unanimity,  and  the  decision  to  select  a resolutions 
committee  on  the  same  plan  that  had  been  adopted  on 
Wednesday  for  the  selection  of  a committee  on  program 
and  arrangements.  The  delegates  from  each  state  were 
authorized  to  appoint  one  member,  and  each  organiza- 
tion of  a general  or  interstate  character  was  similarly  en- 
titled to  representation  on  the  committee.  Many  dele- 


78 


TEUSTS — PKO  AND  CON. 


gates  were  of  the  opinion  that  it  would  be  absolutely  im- 
possible to  wind  up  the  conference  by  the  adoption  of 
any  resolutions  which  could  have  force  or  meaning  un- 
less by  a mere  majority  after  a debate  and  a vote  that 
would  show  distinct  lines  and  cleavage  in  the  conference. 
This  opinion,  however,  may  not  prove  to  be  true.  Some 
of  the  speeches  and  papers  that  have  already  been  pre- 
sented would  seem  to  indicate  practical  propositions  in 
the  production  of  remedies  for  confessed  evils  that  might 
be  put  in  such  a way  as  to  obtain  an  almost  general  sup- 
port from  the  conference.  For  example,  the  proposition 
made  in  the  stirring  speech  of  the  Attorney  General  of 
Maryland,  Mr.  Gaither,  with  which  the  evening  session 
closed,  to  the  effect  that  the  trusts  should  be  brought  un- 
der the  direct  jurisdiction  and  oversight  of  the  federal 
government,  might  upon  a test,  be  found  to  carry  the 
conference  by  a large  majority. 

Upon  that  proposition,  moreover,  it  does  not  now  seem 
likely  that  there  would  be  any  division  of  the  conference, 
either  on  sectional  or  party  lines.  The  proposition  that 
has  been  emphasized  by  a number  of  the  more  scholarly 
students  of  the  trust  question  to  the  effect  that  there 
should  be  an  immense  increase  of  publicity,  and  the  adop- 
tion of  something  like  uniformity  in  accounting,  so  that 
the  public  might  know  as  much  at  least  about  the  capi- 
talization and  operation  of  trusts  as  it  now  knows  about 
the  business  of  national  banks  is  also  a proposition  of 
an  eminently  practical  nature  that  might  well,  if  sub- 
mitted to  the  conference,  find  general  support. 

I mention  these  as  mere  illustrations  of  the  kind  of 
resolutions  that  might  possibly  be  carried  through  this 
particular  conference.  It  is  also  likely  that  some  resolu- 
tion of  considerable  pith  and  point,  touching  the  rela- 
tions of  organized  labor  to  organized  capital,  might  carry 
the  convention  almost  unanimously.  The  discussion  of 
the  tariff  as  related  to  trusts  by  several  gentlemen  in  the 
forenoon  session  was  regarded  in  some  quarters  as  not 
wholly  relevant  to  the  main  subject. 

These  criticisms  were  simply  directed  to  the  point  that 
it  was  the  principle  of  protection  that  was  condemned 
on  the  one  hand  and  eulogized  on  the  other,  that  the 


TKUSTS — PEO  AND  CON. 


79 


actual  facts  as  to  the  extent  to  which  the  tariff  is  pro- 
motive  of  trusts  was  not  completely  debated.  It  is  un- 
doubtedly true,  nevertheless,  that  a large  majority  of  the 
members  of  the  conference  would  be  ready  enough  to  ex- 
press themselves  as  opposed  to  any  tariff  schedules  which 
could  be  clearly  shown  to  be  promotive  of  monopoly,  or 
organizations  which  have  been  formed  to  force  prices  up 
to  the  full  extent  of  the  protective  tax. 

There  do  not  seem  to  be  many  delegates  in  the  con- 
ference who  are  not  disposed  to  discuss  the  trust  ques- 
tion fairly  and  simply  on  its  merits  in  the  light  of  their 
convictions,  with  a reasonable  amount  of  disposition  to 
learn  something  on  a new  subject  which,  after  all,  few 
people  wholly  understand,  except  the  delegations  from 
Texas  and  Arkansas.  Their  point  of  view  is  that  it  is 
not  necessary  to  learn  anything  about  the  subject  in  its 
details  and  varying  phases,  inasmuch  as  they  have  already 
committed  themselves  in  advance  absolutely  to  the  doc- 
trine that  all  trusts,  combinations,  and  monopolies  must 
of  necessity  be  wholly  bad,  and  must,  therefore,  be  dealt 
with  uncompromisingly. 

Their  state  of  mind  is  much  like  that  of  those  prohi- 
bitionists who  have  no  disposition  to  discuss  matters  for 
the  alleviation  of  the  evils  of  the  drink  habit  or  the 
saloon  because  they  do  not  believe  in  compromises  or 
palliations.  The  great  majority  of  the  conference  appar- 
ently is  to  a certain  extent  open  to  conviction  and  is  will- 
ing to  discuss  feasible  means  for  the  regulation  and  con- 
trol of  great  corporate  aggregations. 


PROFESS  OB  COMMONS^  VIEW. 


Tester day^s  session  of  the  trust  conference  gave  us  two 
notable  papers.  One  was  a startling  revelation  of  rail- 
way and  warehouse  methods.  The  other  was  the  most 
brilliant  piece  of  pure  logic  that  has  yet  been  heard.  It 
probably  cannot  be  equaled.  It  was  a marvel  of  audacity 
and  cogency.  The  prolonged  applause  which  followed 


80 


TRUSTS — PRO  AND  CON. 


was  a magnificent  tribute  to  pure  intellect.  That  the  un- 
diluted doctrines  of  anarchism  should  so  transport  a great 
gathering  of  all  classes  here  in  Chicago  would  not  have 
been  predicted.  It  shows  the  catholicity  of  the  audience. 
But  his  logic  was  self-annihilating.  It  was  too  logical. 
It  was  metaphysical.  Yet  few  could  locate  its  fallacy^ 
because  it  started  from  principles  which  Americans  have 
never  dared  to  question,  but  have  always  violated — that 
is,  abstract  justice  based  on  the  natural  equality  of  every 
individual.  Granted  these  premises,  then  every  special 
privilege  bestowed  by  government  has  been  a violation 
of  justice.  It  only  needs  a new  definition  of  special  privi- 
leges, and  these  Mr.  Tucker  gave.  They  are  patents,  tar- 
iffs, land  ownership,  and  money.  These  produce  rent, 
interest,  and  profits,  and  these  in  turn  are  the  essence 
of  trusts.  Do  not  abolish  trusts  but  abolish  all  special 
privileges  and  get  back  to  man’s  natural  equal  justice. 

The  argument  was  faultless,  but  it  overlooked  neces- 
sity, expediency,  the  struggle  for  existence.  The  first 
law  of  life  is  self-preservation.  The  second  law  is 
justice.  You  listen  to  the  trust  defenders  and  the 
trades  union  leaders,  and  you  see  that  they  are  in 
the  fray  of  a mighty  struggle.  With  them  it  is  compe- 
tition: I swallow  you  or  you  swallow  me.  They  have  no 
time  to  think  of  justice.  Their  criterion  is  not  equality 
but  success  and  survival.  They  point  to  prosperity  as 
their  justification,  not  to  justice.  They  must  win.  Ne- 
cessity compels  it.  Success  justifies  it.  They  are  not 
dreamers. 

Not  so  with  Anarchists  and  American  farmers,  for  the 
Anarchist  only  carries  the  farmer’s  theory  of  individual 
justice  to  its  logical  end.  The  Anarchist  wants  equality 
on  abstract  principles,  the  farmer  for  practical  reasons, 
because  he  is  not  in  the  trust.  He  is  the  consumer.  He 
pays  the  bills.  He  sees  the  trusts  and  the  trades  unions 
combine.  He  knows  whose  neck  will  get  it.  He  must 
head  off  the  combination.  He  must  compel  them  to  keep 
on  competing.  He  must  insist  on  that  primitive  equal- 
ity which  still  holds  between  farmer  and  farmer. 

But  he  and  the  Anarchist  are  mistaken.  The  trust 
aud  the  trade  union  have  no  choice,  except  that  empty 


TRUSTS — PRO  AND  CON. 


81 


option  between  life  and  death.  They  must  combine,  or 
cut  throats,  or  be  swallowed.  If  the  farmer  and  Anar- 
chist want  justice  and  equality  they  must  look  for  other 
weapons.  This  trust  conference  is  a magnificent  field 
to  study  these  three  social  types  and  their  two  ways  of 
thinking. 


83 


lEUSTS — EBO  AND  CON, 


THIRD  DAY. 


SINGLE  TAX  VIEW. 


LOUIS  F.  POST. 

The  third  day’s  session  was  called  to  order  at  10:30  a. 
m.  and  Chairman  Howe  introduced  Louis  F.  Post,  of  the 
National  Single  Tax  League.  He  said: 

The  real  trusts  rest  upon  monopoly.  The  trust  ques-’ 
tion  is  at  the  bottom  of  the  monopoly  question.  Trusts 
are  buttressed  by  protection  or  have  direct  special  privi- 
leges, like  railways,  or  peculiar  land  advantages.  In  the 
last  analysis  trusts  cannot  be  perpetuated  unless  they  come 
to  own  the  natural  sources  of  supply  and  distribution — 
the  land.  Like  Antaeus,  they  must  have  their  feet  upon 
the  ground,  and  it  is  only  by  forcing  their  feet  off  the 
ground  that  we  can  destroy  them.  Abolish  the  tariff, 
abolish  all  monopolies  that  can  be  abolished,  take  public 
highways  for  public  use  and  collect  from  land-owners  the 
annual  value  of  their  special  advantages — do  that,  and  you 
put  an  end  to  the  trust.  You  cannot  do  it  in  any  other 
way. 


TEUSTS  FROM  THE  SOCIALISTS^  POINT 
OF  VIEW. 


THOS.  J.  MORGAN. 

Mr.  Post  was  followed  by  Thos.  J.  Morgan,  of  Chicago, 
who  said  in  part: 

We  see  from  the  socialistic  view  not  the  special  inter- 
est of  this  or  that  trade,  of  this  or  that  nation,  of  this 


TRUSTS — PRO  AND  CON. 


83 


or  that  particular  race;  but  we  see  the  interests  of  the 
whole  human  race  as  it  is  involved  in  the  development  of 
modern  industry  and  modern  commerce.  The  socialists 
see  the  end  of  the  feudal  system. 

The  trust  is  the  legitimate  child  of  capital;  and  if  it 
were  not  for  the  seriousness  of  the  problem  we  should 
be  more  than  amused  at  the  efforts  that  are  made  to 
check  the  growth  of  this  offspring  that  are  made  by  those 
that  produce.  The  socialist  sees  that  you  are  totally  im- 
potent to  interfere  with  their  growth  in  the  states  or  in 
the  Union;  they  override  your  state  and  national  laws  in 
their  progress.  We  socialists  go  back  and  look  over  your 
records,  and  we  ask  you  to  listen  to  what  was  before 
the  corporation  came  and  before  the  trust  was  dreamed 
of.  You  individual  employers,  you  individual  business 
men,  you  opened  the  doors  of  the  orphan  asylum  and 
you  took  out  of  it  your  fatherless  children  and  put  them 
into  your  individual  factories  and  ground  their  lives  into 
dollars;  you  took  the  man  and  his  wife,  you  took  the 
mother  and  the  child,  and  you  put  them  into  the  bowels 
of  the  earth  to  bring  out  your  black  diamonds  so  you 
could  enrich  yourselves.  That  spirit  is  not  dead.  It  is 
seen  in  Africa,  where  the  poor  Kaffir  is  down  in  the  dia- 
mond mines  and  the  gold  mines.  It  is  seen  in  the  ef- 
fort to  subdue  the  Boers.  Kot  alone  there,  but  here — 
you  freed  Cuba,  didnT  you?  Oh,  the  poor  Cubans!  They 
must  be  freed  from  Spain.  But  what  do  you  do  with  the 
negro  down  South — you  disfranchise  him.  (Applause.) 
Then,  you  individualistic  business  men,  your  spirit  goes 
out  into  the  Philippines  and  will  reduce  the  Filipinos  to 
the  level  of  your  negroes  down  South.  (Applause.) 

The  fetich  of  private  property  in  the  mines,  in  the  oil 
regions,  in  the  forests,  in  the  fields,  and  everywhere  else 
is  the  bane  of  civilization,  is  the  illusion  of  civilization, 
and  must  be  wiped  out  of  the  intellect.  We  socialists  re- 
joice that  the  trust  has  come  to  show  you  that  the  logical 
sequence  of  the  ownership  and  control  of  what  is  now 
known  as  private  property  and  the  resources  of  the  earth 
will  be  one  trust,  and  you  will  not  be  in  it. 


84 


TRUSTS — PRO  AND  CON. 


TEUSTS  AND  COMBINATIONS. 


JOHN  W.  HAYES. 

The  next  speaker  was  John  W.  Hayes^  general  secre- 
tary of  the  Knights  of  Labor.  He  said: 

The  question  which  we  are  invited  here  to  discuss^ 
^^Trusts  and  Combinations/^  is  fast  pressing  itself  for  so- 
lution before  the  highest  tribunal  in  the  nation^  the  court 
of  final  resort  for  all  questions  of  public  policy^,  the  court 
of  public  opinion.  I shall,  therefore,  discuss  this  question 
only  as  it  bears  upon  the  broad  field  of  human  rights,  and 
deny  at  the  outset  the  moral  right  of  any  individual  or 
combination  of  individuals  to  so  monopolize  any  natural 
field  of  industry  to  such  an  extent  as  to  be  able  to  dictate 
the  conditions  which  govern  the  lives  of  that  portion  of 
society  that  gains  its  maintenance  by  the  exercise  of  pro- 
ductive industry  in  that  particular  field.  I assert  that 
it  is  contrary  to  the  best  interests  of  society;  indeed,  that 
government  has  not  the  constitutional  power  to  enact  such 
legislation  as  will  make  it  possible  for  any  combination  of 
individuals  to  so  limit  the  volume  of  production  in  any 
natural  field  for  its  own  particular  advantage;  or  so  cre- 
ate conditions  that  any  individual  or  combination  of  in- 
dividuals may  have  despotic  power  over  the  lives  of  any 
citizen  or  number  of  citizens. 

I further  assert  and  maintain  that  these  great  combi- 
nations are  an  assault  upon  the  inherent  and  constitutional 
rights  of  the  citizens;  that  the  real  and  vital  advantage 
to  be  gained  is  the  despotic  control  over  labor. 

Violence  is  not  the  only  means  of  making  conquests  and 
enslaving  the  people,  and  it  can  be  proven  beyond  any 
question  of  doubt  that  the  methods  of  the  trusts  are 
the  methods  of  the  invader,  the  conqueror  and  the  despot, 
and  the  ends  to  be  accomplished  by  the  instigators  of  the 
trusts  are  exactly  those  intended  to  be  accomplished  by 
arms  directed  by  military  genius.  Taking  this  view  of 


TRUSTS — PRO  AND  CON. 


85 


THE  “TEXAS  IDEA  IN  THE  SADDLE. 


—From  the  Chicago  Tribune. 


86 


TRUSTS — PRO  AND  OON.  ' 


the  trusts^  which  I hold  is  the  correct  one,  I assert  boldly 
that  they  are  the  enemies  of  society,  and  as  such  should 
be  destro5^ed,  as  any  common  enemy,  and  that  the  finan- 
cial phase  of  the  question  should  not  come  into  the  sub- 
ject for  consideration,  and  the  liberties  of  the  people  are 
far  above  the  mere  question  of  money. 

The  good  of  society  demands  that  the  productive  en- 
ergy be  developed  to  the  greatest  degree  possible;  that 
the  fields  of  industry  be  not  circumscribed,  and  that  free 
access  be  guaranteed  and  preserved  to  all  who  require 
or  desire  to  exercise  their  productive  labor  in  such  fields. 
The  controlling  of  any  field  of  industry  by  any  individ- 
ual or  combination  of  individuals  is  contrary  to  the  de- 
clared spirit  of  our  Constitution. 

EIGHTS  OF  INDIVIDUALS  VIOLATED. 

The  great  object  of  human  endeavor  is  the  achieve- 
ment of  the  greatest  degree  of  human  happiness.  This 
is  the  great  aim  of  all  human  society,  all  human  govern- 
ment, and  this  is  the  declared  and  recognized  purpose  for 
which  our  free  institutions  were  devised  and  established; 
and  the  machinery  of  our  government  was  designed  and 
constructed  for  the  purpose  of  accomplishing  this  result 
in  the  most  effective  manner.  By  reserving  the  inher- 
ent rights  and  interests  of  the  individual  and  defending 
the  dignity  of  citizenship  it  is  hoped  that  the  citizen 
may  be  protected  from  the  tyranny  of  more  fortunate  in- 
dividuals and  classes,  and  the  oppression  of  unjust  con- 
ditions and  influences  which  may  assail  him,  and  be  left 
untrammeled  in  his  pursuit  of  that  degree  of  happiness 
to  which  he  may  aspire. 

The  trust  being  an  aggressive  combination  for  purely 
selfish  objects,  attacks  the  individual,  and  by  overthrow- 
ing his  mutual  rights  seizes  upon  his  field  of  opportunity 
and  production,  appropriating  them  to  its  own  personal 
advantages.  This  field  having  been  conquered  and  the 
trust  strengthened  in  its  financial  power,  the  aggressive 
spirit  of  selfish  greed  looks  for  conquests  in  allied  fields, 
which  are  soon  invaded  and  monopolized,  or  other  com- 
binations, seeing  the  success  of  the  first  attempt,  enter 
upon  the  same  campaign  of  conquest.  Soon  the  indi- 


TRUSTS — PRO  AND  CON. 


87 


vidual  is  overwhelmed  and  every  field  of  production  is 
monopolized  by  a trust. 

To  sum  up  the  whole^  this  policy  of  the  trusts  is  an 
aggressive  invasion  organized  against  the  best  interests 
of  society  and  destructive  to  our  free  institutions  and 
popular  government.  It  is  too  often  the  instigation  of 
fraud,  corruption^  bribery  and  treason.  It  is  the  ally  of 
despotism,  tyranny,  mercenary  selfishness  and  slavery,  and 
is  the  enemy  of  the  elevation  of  the  race  and  the  equal- 
ity of  man. 


TRUSTS  AND  ORGANIZED  LABOR. 


HENRY  WHITE. 

Henry  White  of  New  York,  general  secretary  of  the 
United  Garment  Workers  of  America,  said: 

On  this  serious  problem,  where  does  labor  stand?  I 
have  been  invited  to  speak  from  the  standpoint  of  the 
wage  earners,  or  rather  the  organized  portion  of  them, 
for  the  unorganized  have  no  voice  and  like  ^The  man 
with  the  hoe”  have  always  been  mute.  The  attitude  of 
the  trade  unions  toward  the  great  industrial  corporations 
depends  altogether  upon  their  attitude  toward  the  unions. 
The  organized  workingmen,  while  they  may  disagree 
somewhat  on  the  general  question,  agree  on  this,  that 
improved  means  of  protection  is  of  more  consequence  to 
them  than  improved  methods  of  production.  To  have 
some  say  as  to  the  terms  of  employment  is  what  is  wanted. 

Even  though  the  trust  may  concede  higher  wages  and 
shorter  hours,  it  is  the  recognition  of  the  right  to  make 
terms  through  the  agency  of  the  union  that  concerns  them 
most.  Employers  will  often  voluntarily  grant  concessions 
as  the  means  of  offsetting  the  demand  for  recognition, 
knowing  that  such  recognition  would  enable  the  men  to 
deal  with  the  employer  more  like  an  equal.  Will  it  be 
the  policy  of  these  corporations  to  recognize  the  function 
which  organized  labor  fulfills  in  society  and  treat  with 
them  as  such,  or  will  they  deny  to  the  workers  advan- 
tages which  they  themselves  enjoy?  Will  they  insist  upon 


88 


TRUSTS — PRO  AND  CON. 


ignoring  the  necessity  of  workingmen  acting  in  groups 
in  view  of  the  impossibility  of  the  individual  making  sat- 
isfactory terms  of  employment  in  a great  factory  where 
uniform  conditions  are  determined  by  the  management? 

LABOE  MUST  CONTINUE  ACTIVE. 

What  will  the  policy  be  toward  united  labor  when  the 
trusts  are  more  fully  established?  Will  the  unions  not 
have  to  meet  a more  unyielding  foe?  That  is  the  ques- 
tion which  a million  organized  mechanics  are  asking,  and 
an  assuring  answer  cannot  be  given  by  words  alone.  It 
might  be  said  that  necessity  would  stimulate  and 
strengthen  the  movement  of  the  workers.  No  doubt  it 
will,  because  years  of  struggle  and  sacrifice  made  for  eco- 
nomic independence  have  trained  and  nerved  the  Amer- 
ican toiler  for  a greater  trial,  and  the  test  must  soon 
come,  for  the  organizations  on  the  other  side  are  pro- 
ceeding at  such  a pace  that  labor  will  have  to  make  great 
strides  to  catch  up.  To  meet  one  single  employer  who 
speaks  for  the  entire  trade  is  quite  different  than  coping 
with  one  who  represents  himself  alone. 

The  trust  managers  have  magnificent  opportunities. 
Will  they  avail  themselves  of  them?  Will  they  show  the 
necessary  large-mindedness?  Judging  by  our  knowledge 
of  human  nature,  which  we  know  has  not  changed  per- 
ceptibly for  a thousand  years  under  varying  conditions, 
we  have  cause  to  possess  grave  doubts  as  to  whether  they 
will.  But  the  American  people  have  never  failed  to  suc- 
cessfully meet  a great  issue  when  once  they  grapple  with  it. 

In  the  lowering  clouds  of  social  strife  there  is  welcome 
light.  The  mere  fact  of  such  a gathering  gives  us  hope 
that  the  age  of  reason  is  dawning,  and  when  men  reason 
everything  is  possible. 


TRUSTS  AND  UNIONS. 


SAMUEL  GOMPERS. 

President  Gomp,ers,  of  the  American  Federation  of  La- 
bor, said  in  part: 

Perhaps  the  greatest  sufferers  from  the  wrongs  which 


TRUSTS — PRO  AND  CON. 


89 


the  combinations  have  done  society  have  been  the  wage 
. earners^  but  in  spite  of  this  fact  we  do  not  close  our 
eyes  to  actual  facts  and  conditions  or  join  in  the  general 
howl  simply  for  the  purpose  of  howling.  The  cry  is  now 
by  a large  number  of  our  people  for  untrammeled  com- 
petition, and  the  old  cry  which  was  turned  against  the 
organized  efforts  of  the  workers  for  improved  conditions 
is  turning  against  the  combinations  of  capital.  They 
grow  and  will  grow,  and  I have  no  hesitation  in  say- 
ing that  the  organization  of  industry  upon  a higher  and 
more  scientific  basis  will  continue. 

If  prices  have  been  raised  the  combinations  of  capital 
have  always  been  held  responsible.  If  prices  have  fallen 
when  combinations  of  capital  exist  it  is  argued  that  they 
would  have  fallen  still  lower  if  the  individual  concern 
had  existed.  Be  this  as  it  may,  this  proposition  cannot 
be  disputed,  that  prices  continually  tend  downward.  On 
the  other  hand,  the  tendency  of  wages,  in  spite  of  all 
declarations  of  the  pessimists  and  the  enemies  of  organ- 
ized labor,  is  upward,  due  solely  to  the  organized  effort  of 
the  wage  earner. 

It  has  been  said  that  organized  labor  is  a trust,  and  I 
want  to  say  in  connection  with  this  that  to  our  minds 
that  is  an  absolute  misnomer.  Organized  labor  throws 
open  its  doors  to  all  who  work  for  wages,  and  asks  them 
to  come  in  and  share  in  the  benefits.  We  try  to  prevent 
by  all  means  within  our  power  anyone  from  leaving  or  get- 
ting outside  of  the  union.  You  cannot  break  into  a 
trust.  And  for  this  reason  I want  to  say  that  any  legis- 
lation proposed  by  this  conference  or  by  any  legislature 
or  by  congress  which  does  not  eliminate  or  specially  ex- 
empt organized  labor  from  the  operations  of  the  law  will 
meet  the  unquestioned  opposition  of  all  the  labor  forces 
of  our  country. 

I believe  we  can  tax  the  corporations;  we  can  tax  fran- 
chises; we  can  advocate  and  have  municipal  and  common 
ownership  of  public  utilities.  In  the  midst  of  greater 
concentrations  of  wealth  and  the  vast  development  of  in- 
dustry, it  behooves  the  workers  more  ceaselessly  than  ever 
to  devote  their  energies  to  organized  labor  and  to  coun- 
teract the  effect  which  otherwise  their  helpless  and  un- 


90 


TRUSTS — PRO  AND  COK. 


protected  condition  would  have  upon  them.  Organized 
and  alert;,  the  workers  cannot  fail  to  lighten  toil^  shorten 
hours  and  lengthen  life  by  constant  and  persistent  effort, 
and  make  the  world  better  for  our  having  lived  in  it. 


A PRACTICAL  VIEW. 


M.  M.  GARLAND. 

M.  M.  Garland,  ex-president  of  the  Amalgamated  As- 
sociation of  Iron,  Steel  and  Tin  Workers,  spoke  in  part 
as  follows: 

The  whole  life  of  the  man  employed  in  the  iron  and 
steel  rolling-mills  must,  from  the  very  nature  of  his  labor, 
be  practical.  The  trust  question  is  an  old  one.  It  has 
been  the  instigator  of  much  attempted  legislation  and  has 
formed  the  target  for  campaign  speakers  in  almost  every 
kind  of  elections.  When  the  iron  and  steel  worker  be- 
came convinced  that  the  vast  industrial  pursuits  of  the 
world  were  becoming  centralized  under  the  control  of 
a comparatively  small  portion  of  mankind  he  realized  that 
to  secure  for  himself  an  equivalent  for  his  labor  sufficient 
to  maintain  him  in  comparative  independence  and  respec- 
tability it  was  absolutely  compulsory  that  he  form  a com- 
bination with  his  fellow  'Workers  to  control,  as  far  as  pos- 
sible, wages  and  fair  treatment.  This  organization  was 
immediately  termed  a trust  by  many,  but  the  fair  mind 
cannot  consider  the  open  trade  union  as  such  under  the 
general  acceptance  of  the  term. 

But  in  deference  to  a number  of  decisions  by  eminent 
judges  in  the  several  states  and  the  decision  of  an  Attor- 
ney-General of  the  United  States,  all  of  which  declare  us 
at  least  amenable  to  whatever  penalties  would  occur  to 
trusts  violating  the  statute  of  present  enacted  anti-trust 
legislation,  to  that  extent  we  are  compelled  to  accept  the 
onus.  But  it  is  the  recent  rush  of  corporations  doing 
business  in  the  same  line  of  manufacture  or  interest  into 
one  or  more  immense  corporate  combinations,  usually 


I'llUSTS — PRO  AND  CON. 


91 


termed  trusts,  that  has  challenged  widespread  comment 
and  occasioned  the  discussion  of  the  question  by  this  con- 
ference. No  corporation  desires  to  lose  its  identity,  and 
there  can  be  no  doubt  that  much  of  this  in  the  iron 
and  steel  industry  has  been  caused  by  the  same  element 
that  forced  the  workmen  to  organize — that  of  self-preser- 
vation. The  corporation  of  many  years^  standing  had 
grown  with  the  increased  uses  of  iron  and  steel  until,  in 
some  branches  of  the  trade,  several  firms  were  more  pow- 
erful and  held  more  assets,  each  one  in  themselves,  than 
any  of  the  trusts  that  have  yet  been  formed  in  the  same 
line  of  business.  We  have  passed  the  point  where  corpo- 
rations in  iron  and  steel  were  of  great  moment  whose  cap- 
italization was  limited  to  thousands  or  hundreds  of  thou- 
sands of  dollars,  and  we  have  entered  the  era  of  millions 
and  hundreds  of  millions  of  dollars  capitalization. 


CA  VTION  A GAINST  DEM  A GOG  UES. 


DAVID  ROSS. 

Mr.  Eoss,  of  the  Illinois  State  Bureau  of  Labor  Statis- 
tics, urged  briefly  the  use  of  judgment  and  reason  by 
the  conference  in  the  consideration  of  the  great  ques- 
tions before  it,  and  cautioning  laboring  men  not  to  make 
the  mistake,  in  their  crusade  against  industrial  combi- 
nation, of  delegating  too  much  power  to  demagogues.  He 
said  in  part: 

Let  us  not  forget  that  we  are  the  representatives  of 
the  free  government,  and  that  power  still  remains  with 
us.  Let  us  remember  that  no  private  interest  is  secure 
when  exercised  to  the  detriment  of  public  welfare. 

In  the  judgment  of  some  disciples  of  disaster,  through 
our  own  personal  neglect,  we  have  become  the  victims 
of  organized  villainy  and  the  playthings  of  power;  noth- 
ing can  save  us  now  except  an  appeal  to  members  of 
law-making  assemblies.  I recognize  the  power  and  influ- 
ence of  legislation,  yet  I doubt  if  we  can  be  saved  through 
the  instrumentality  of  law. 


92 


TRUSTS — PRO  AKD  COn. 


There  are  three  propositions  in  which  the  workers  for 
wages  are  vitally  concerned — the  duration  of  the  day^s 
work^  the  compensation  or  value  of  their  labor,  the  cost 
of  what  they  have  to  buy. 

Laboring  men,  whose  sympathies  will  be  relied  upon 
to  aid  in  the  crusade  against  all  forms  of  industrial  com- 
binations, should  have  a care  lest  they  delegate  to  dema- 
gogues the  power  to  punish  and  oppress. 


G O VERNMENT  0 WEERSHIP. 


M.  L.  LOCKWOOD. 

M.  L.  Lockwood,  President  of  the  American  Anti-Trust 
league,  spoke  as  the  advocate  of  government  ownership 
of  railroads.  He  argued  that  with  the  nation  in  full  con- 
trol of  the  railways,  equal  rates  could  be  maintained,  and 
the  greatest  of  all  hindrances  removed  from  the  pathway 
of  free  competition  in  industrial  life.  He  made  a clos- 
ing plea  for  harmonious  co-operation  of  all  parties  in 
defense  of  the  fundamental  principles  of  the  American 
republic,  and  the  re-establishment  of  equal  rights  and 
opportunities  to  the  American  citizenship.  He  spoke  in 
part  as  follows: 

We  are  confronted  by  great  questions — greater,  I feel, 
than  have  ever  confronted  any  generation  of  men.  Slowly 
and  by  tortuous  route  man  has  pulled  himself  up  to  the 
present  stage  of  civilization.  We  now  live  in  the  most 
important  age  of  all  the  centuries;  in  an  age  in  which 
the  capability  of  this  man  for  self-government  will  be  put 
to  a new  test — tested  in  that  crucible  of  unlimited  sup- 
ply of  corrupt  corporate  money  in  our  public  life.  Ab- 
solutely unlimited  corrupt  money — ^because  if  they  may  be 
allowed  to  destroy  competition  and  plunder  the  people, 
the  trusts,  and  monopolies,  and  railroad  combines  can  af- 
ford to  make  it  absolutely  unlimited. 

I was  somewhat  surprised  last  evening  to  hear  a gentle- 
man upon  this  floor  tell  an  American  audience  that  Rus- 


TRUSTS — PRO  AND  CON. 


93 


sia  had  put  protective  tax  of  $2  a barrel  on  oil  to 
keep  American  oil  from  driving  the  Kussian  oil  out  of 
Eussian  markets,  and  in  the  next  moment  he  tells  us 
that  if  it  had  not  been  for  the  organizing  genius  of  the 
Standard  Oil  Company  people,  Eussian  oil  would  have 
flooded  the  American  markets  and  dried  up  the  American 
oil  wells  and  shut  down  American  refineries.  Now  that 
is  spreading  it  on  pretty  thick — thicker  than  I have  been 
used  to,  and  I have  been  used  to  a great  deal. 

EAILEOADS  BACK  OF  TEUSTS. 

The  gentleman  would  have  us  believe  that  the  Standard 
Oil  Company  has  a monopoly  of  the  brain  and  business 
capacity  of  America,  but  I want  to  tell  the  gentleman  and 
you  that  if  it  had  not  been  for  railway  rebates  and  dis- 
criminations there  never  would  have  been  a Standard  Oil 
trust  monopoly.  I want  to  say  to  the  gentleman  and  to 
you  that  if  he  will  re-establish  and  maintain  equal  rates 
over  the  railways  of  America,  in  spite  of  this  legitimate 
evolution  of  business  that  we  hear  so  much  about,  the 
energy^  enterprise,  courage,  and  business  capacity  of  the 
American  people  will  drive  the  Standard  Oil  Company, 
with  its  extravagant  methods,  into  a secondary  .position  in 
the  oil  trade  of  America  in  less  than  ten  years. 

Then  what  is  the  remedy?  Take  these  railways  away 
from  these  corporations.  Let  the  government  own  and 
run  them.  One  great  advantage  of  national  ownership 
is  that  the  bonded  debt  necessary  to  purchase  all  these 
roads  could  be  placed  by  the  government  at  from  to 
3 per  cent  less  interest  annually  than  is  now  being  paid 
by  these  corporations  on  their  bonded  indebtedness. 

Let  all  men  of  all  parties,  religions,  and  creeds  who  are 
opposed  to  trusts  and  monopolies  and  who  are  in  favor 
of  the  great  basic  principles  of  equal  rights  to  all  and 
special  privileges  to  none  join  in  the  defense.  The  weapon 
is  in  your  hands,  the  greatest  weapon  in  all  the  annals 
of  time — the  ballot.  TJse  it  and  see  that  it  is  honestly 
counted.  He  who  would  use  dynamite  and  vote  wrong 
will  be  damned  through  all  eternity. 


94 


TRUSTS — PRO  AND  CON. 


NEW  JERSEY  AND  THE  TRUSTS. 


EDWARD  KEASBEY. 

Edward  Keasbey,  of  New  Jersey,  was  introduced,  after 
a photographer  had  taken  a flash-light  picture  of  the  dele- 
gates and  audience.  Mr.  Keasbey's  subject  was  ^‘^New  Jer- 
sey and  the  Trusts.^^  He  disclaimed  any  intention  of 
protecting  or  defending  trusts,  saying  they  were  all  big 
enough  to  take  care  of  themselves.  After  enumerating  a 
large  number  of  trusts  which  had  been  formed  under 
the  laws  of  New  Jersey,  Mr.  Keasbey  spoke  in  part  as  fol- 
lows: 

There  has  been  no  trust  in  the  proper  sense  of  the 
word  for  the  last  ten  years,  and  all  legislation  directed 
against  trusts  and  against  combinations,  as  such,  is  fu- 
tile and  of  no  account.  Now  it  seems  bold  to  say  such 
a thing  as  that  here,  after  we  have  been  discussing  com- 
binations and  trusts  for  three  days,  but  it  is  true.  All 
our  energies  are  misdirected,  if  we  direct  them  against 
what  we  call  unlawful  combinations  and  against  trusts, 
because  business-men  have  long  since  learned  that  it  is 
not  safe  to  combine  in  such  a way  that  the  courts  will 
say  that  their  combinations  are  against  public  policy. 

I do  not  think  I need  spend  any  time  before  this  audi- 
ence in  arguing  the  question  that  we  are  not  to  break 
down  the  corporations  entirely.  They  have  been  the 
means  of  carrying  on  large  undertakings.  They  have  ac- 
complished too  much  for  this  country  to  be  destroyed.  It 
may  turn  out  that  some  day  great  corporations  will  or- 
ganize— well  managed,  conservative,  and  steady,  free  from 
the  dangers  of  bitter  competition,  regulating  prices  ac- 
cording to  demand — ^which  will  have  the  investment  of 
all  the  people  of  the  country,  so  that  there  will  be  a 
means  of  safe,  steady  investment,  such  as  no  ordinary  busi- 
ness corporation  is  now,  because  of  the  danger  of  sud- 
den destruction. 


TRUSTS — PRO  AND  CON. 


95 


There  is  a remedy  which  we  ought  to  try  at  once^  and 
that  is  to  make  the  trusts  disclose  to  the  public  what 
the  capital  stock  of  the  company  is  made  up  of,  and  not 
to  allow  the  fraudulent  inflation  of  stock.  Let  their  cap- 
ital stock  represent  not  exactly  their  property  in  the 
business  but  what  they  can  earn  a dividend  on.  It  is  not 
necessary  it  should  be  actual  property.  Let  every  com- 
pany be  compelled  to  file  in  its  own  office  the  actual  con- 
tract for  which  its  capital  stock  is  issued  and  let  every 
stockholder  and  every  member  of  the  public  have  a copy 
of  this  on  payment  of  ten  cents.  That  is  the  plan  that 
is  followed  in  England,  where  great  combinations  of  capi- 
tal have  been  effected,  and  they  have  not  had  the  out- 
cry there  against  trusts  that  we  are  having  here. 


TEE  TRUST  PROBLEM. 


PROP.  E.  W.  BEMIS. 

Professor  Edward  W.  Bemis,  of  the  New  York  Bureau 
of  Economic  Research,  spoke  on  ^‘The  Trust  Problem.’^ 
He  claimed  that  the  greatest  danger  in  the  trust  ^.s  the 
menace  to  political  purity  and  personal  liberty  involved 
in  the  efforts  of  law-making  bodies  to  regulate  city  mon- 
opolies of  light,  heat,  and  transportation.  He  believed 
that  the  trust  problem  would  require  a generation  or  more 
to  settle.  He  spoke  in  part  as  follows: 

First — We  may  leave  the  entire  matter  alone,  in  the 
belief  that  many  of  these  trusts  will  soon  go  to  pieces. 
The  revival  of  the  copper  syndicate  in  stronger  form  than 
ever,  despite  the  failure  of  the  previous  one,  and  the  his- 
tory of  many  other  experiences,  show  that  while  many 
trusts  will  doubtless  go  to  the  wall  from  time  to  time, 
the  trust  movement  is  likely  to  become  stronger  and 
stronger  if  left  undisturbed. 

Second — We  may  favor  the  solution  which  is  attract- 
ing some  attention  in  England,  where,  if  I understand 
the  matter  aright,  the  trust  of  capital  allies  itself  with 


96 


TRUSTS — PRO  AND  CON. 


a strong  labor  combination^  and  the  two  together  agree 
to  rob  the  consumer  of  all  they  can^  the  monopoly  prof- 
its to  be  divided  in  the  proportion  of  two  parts  for  cap- 
ital to  one  part  for  labor.  That  such  a solution  will  ever 
satisfy  the  community  for  any  length  of  time  is  incred- 
ible. 

Third — We  may  smash  the  trusty  or  endeavor  to  do  so. 
The  trouble  with  this  is  two-fold.  It  cuts  us  oft  from 
any  possibility  of  securing  the  advantages  which^  under 
a better  social  organization,  the  general  public  might  de- 
rive from  the  trust;  and  in  the  second  place^  it  seems 
to  fly  in  the  face  of  industrial  evolution. 

Fourth — A more  hopeful  attack  upon  the  abuses  of 
the  trusts  consists  of  the  removal  of  tariffs  upon  such 
products  as  Congress  shall  decide  to  be  of  trust  make. 

Fifth — The  notorious  and  widespread  granting  of  secret 
rebates  and  other  privileges  by  railroads  to  large  ship- 
pers^ and  particularly  to  trusts  and  combinations,  must 
be  checked  in  the  most  summary  and  speedy  manner. 

Sixth — The  conference  has  been  several  times  invited 
to  consider  direct  public  regulation  of  the  trust.  This 
will  require,  in  a large  measure,  preliminary  constitutional 
changes. 

Our  American  states  will  have  to  cease  to  be  contented 
with  commissioners,  staters  attorneys,  and  so  forth,  worth 
two  or  three  thousand  dollars  a year,  and  going  out  of 
office  with  every  change  of  administration,  while  a sugar 
refinery  or  a railroad  is  ready  to  pay  five  to  ten  times 
that  amount  for  its  talent,  wherewith  to  oppose  or  check- 
mate public  control. 


BEGTILATION  OF  TRUSTS. 


PROF.  JOHN  BATES  CLARK. 

John  Bates  Clark,  of  Columbia  University,  New  York, 
suggested  in  his  address  a plan  of  action  for  the  regu- 
lation of  the  trust  which  received  thoughtful  attention 
from  the  audience.  He  suggested  the  adoption  of  a fed- 
eral law,  and  a possible  amendment  of  the  federal  con- 


TKUSTS — PKO  AND  CON. 


97 


stitution^  with  a commission  endowed  with  greater  power 
than  most  bodies  of  the  kind  possess.  He  spoke  in  part 
as  follows: 

Monopolies  are  inherently  evil^  and  trusts  that  are  true 
monopolies  have  an  evil  element  in  them.  The  evolu- 
tion that  is  now  in  progress  has  already  gone  far  enough 
to  reveal  the  difference  between  an  apparent  monopoly 
and  a true  one.  Though  all  the  goods  of  a certain  class 
were  made  in  one  overgrown  establishment  the  owners 
of  it  would  not  necessarily  be  monopolists.  If  they  cur- 
tail the  output  of  the  goods  at  will  and  raise  the  price 
to  the  point  that  would  yield  to  them  the  largest  profit 
they  would  be  true  monopolists^  and  they  could  practice 
extortion  on  the  consuming  public^  and  also  on  the  wage- 
earning class.  If  they  cannot  thus  control  output  and 
price  they  are  not  true  monopolists^  and  can  practice  no 
extortion. 

COMPETITION  PULES  EVEN  TRUSTS. 

Actual  trusts  have  only  a limited  monopoly  price,  and 
it  is  a survival  of  competition  that  holds  them  within 
limits.  The  new  mill  that  has  not  been  built,  but  will 
be  built  if  prices  reach  a certain  level,  is  the  means  of 
preventing  them  from  reaching  that  high  level.  It  is 
a common  though  inaccurate  remark  that  trusts  have 
lowered  prices;  and  it  is  a fact  that  they  have  not  raised 
them  by  more  than  a small  fraction  of  the  amount  that 
genuine  monopolies  would  have  added  to  the  competi- 
tive and  natural  rate;  it  is  the  potential  competitor  who  is 
the  cause  of  this.  Competition  that  to-day  is  latent,  but 
will  be  active  to-morrow  if  the  price  of  an  article  is 
raised  by  1 per  cent,  holds  the  price  down  as  rigorously 
as  natural  active  competition  does. 

Potential  competition  is  capable  of  being  an  adequate 
regulator  of  prices;  and  the  striking  fact  is  that,  if  only 
this  kind  of  regulation  were  as  efficient  as  it  probably 
might  be,  the  natural  level  of  prices,  under  a regime  of 
trusts,  would  be  lower  than  it  has  been  under  a regime 
of  smaller  establishments. 


98 


TRUSTS — PRO  AND  CON. 


WHAT  THEIR  EXTINCTION  MEANS. 

The  whole  great  economy  that  consolidation  insures 
may  be  made  to  inure  to  the  benefit  of  the  public  if  only 
potential  competition  does  its  normal  work.  Trusts  with 
the  element  of  true  monopoly  taken  out  of  them  might 
become  as  popular  as  they  are  now  unpopular.  They 
might  give  to  the  country  in  which  they  should  be  most 
numerous  a decisive  advantage  in  the  struggle  for  the 
trade  of  the  world.  What  would  the  total  extinction  of 
trusts  mean?  It  would  mean  security  bought  at  the  cost 
of  wasteful  production.  What  would  the  full  develop- 
ment of  trusts  unchecked  by  potential  competition  mean? 
It  would  mean  a perverted  distribution,  with  extortionate 
profits  for  a few  and  burdens  for  many.  It  would  mean 
a state  from  which  many  a man  to  whom  the  picture  of 
state  socialism  is  now  a terrifying  specter  would  even 
begin  to  turn  to  socialism  itself  as  the  more  tolerable 
system. 

Are  these  the  only  alterations?  Far  from  it.  A bet- 
ter one  is  in  part  realized.  Trusts  are  largely  checked  by 
potential  competition,  and  may  be  checked  far  more  effi- 
ciently than  they  now  are.  The  type  of  law  making  that 
promises  to  secure  this  end  is  as  yet  unknown  to  the 
practical  world.  The  principle  on  which  it  rests  is  an 
old  and  fundamental  principle  of  common  law. 

AGAINST  PUBLIC  INTEREST. 

Monopolies  are  against  public  interest,  and  trusts  must 
not  survive  if  that  means  retaining  the  monopolistic  power. 
Courts  acting  under  common  law  have  done  little  in  en- 
forcing this  principle^  and  statutes  may  help  them.  Stat- 
utes well  enforced  may  greatly  help  them.  The  evil 
power  of  a trust  rests  almost  on  its  power  to  make  dis- 
criminating prices.  It  can  do  many  things  that  are  evil, 
but  it  could  do  almost  none  of  them  if  it  were  forced  to 
treat  all  its  customers  alike.  At  present  the  trust  can 
make  ruinously  low  prices  in  one  small  area  where  some 
competitor  is  operating  while  sustaining  itself  by  profits 
made  in  twenty  other  areas  where  it  has  a full  posses- 
sion of  the  market.  If  it  were  under  the  single  neces- 


TRUSTS — PRO  AND  CON. 


99 


sity  of  making  one  price  for  all  buyers  it  would  ruin  it- 
self by  any  attempt  to  compete  in  the  cut-throat  way  as 
quickly  as  it  could  ruin  a competitor. 

OBSTACLES  TO  FEDERAL  SUPERVISION. 

There  is  much  to  be  said  in  the  elaboration  of  the  plan 
of  action  that  I suggest  in  a way  that  is  too  unique  to 
win  for  it  any  adequate  hearing.  It  would  require  a fed- 
eral law,  and  possibly  an  amendment  of  the  federal  con- 
stitution. It  would  require  for  efficiency  a commission 
endowed  with  greater  power  than  most  bodies  of  this 
kind  possess.  It  would  require  a vigorous  prosecution  of 
the  work  that  our  people  meant  to  entrust  to  the  inter- 
state commerce  commission,  and  the  suppression  of  cor- 
rupt dealings  between  favored  mediums  and  corrupt  car- 
riers. We  would  require  the  overcoming  of  many  preju- 
dices. We  shall  have  the  trust  forever.  The  economy 
that  is  inherent  in  its  plan  of  production  will  save  it. 
We  shall  yet  have  more  than  a trace  of  monopoly.  Un- 
der the  shelter  of  laws  that  seem  strange  to-day,  but  will 
seem  natural  when  experience  shall  be  riper,  the  full 
benefit  of  competition  will  be  secured  by  the  purchasing 
public  and  by  the  wage  earning  classes.  The  wastes  of 
the  present  type  of  competition  will  be  avoided,  and  yet 
the  protection  that  it  affords  will  be  retained.  The  pos- 
sibility of  having  trusts  without  true  monopolies  will  make 
socialism  unnecessary. 


EVENING  SESSION. 

Permanent  Chairman  Howe  opened  the  evening’s  ses- 
sion at  8 o’clock  and  called  to  order  hundreds  of  delegates 
and  thousands  of  visitors  in  the  parquet  and  balcony  and 
gallery. 

William  Dudley  Poulke  was  presented  as  the  first  speaker 
of  the  evening.  He  had  proceeded,  with  frequent  ap- 
plause and  close  attention  from  the  listeners,  for  twenty 
minutes  when  Bourke  Cockran  approached  from  the  wings 
to  a seat  on  the  stage,  and  the  audience  broke  into  pro- 
longed cheers. 


100 


TRUSTS — PRO  AND  CON. 


THE  PARAMOUNT  ISSUE. 


WILLIAM  DUDLEY  FOULKE. 

Mr.  Foiilke  said  in  part:  This  question,  ladies  and 
gentlemen,  dwarfs  into  insignificance  all  other  issues  at  the 
present  time,  not  only  in  our  country  but  throughout  the 
world.  When  Dreyfus  shall  have  been  forgotten,  when 
the  war  of  the  Philippines  shall  be  regarded  as  only  an 
incident  in  history,  when  men  shall  cease  to  talk  either  of 
the  tariff  or  the  currency,  the  present  time  may  well  be 
regarded  by  future  generations  as  the  crucial  time  in  our 
industrial  life. 

Those  that  have  been  suffering  from  competition  have 
resolved  themselves  into  combinations  for  two  purposes. 
First,  to  save  expenses  which  competition  involves.  That 
is  the  first  and  necessary  purpose.  Secondly,  also  to  con- 
trol, if  possible,  the  market,  and  get  a larger  profit.  The 
first  proposition  is  a wise  one.  Society  justifies  the  cur- 
tailment of  expenses  as  much  as  possible;  the  second,  how- 
ever, the  suppression  of  competition,  gives  them  the  power 
of  monopoly,  a power  Avhich  may  be  used  for  the  purpose 
not  simply  of  meeting  rivals  and  competitors,  but  may  be 
used  for  the  displacement  of  labor,  and  may  be  used  to 
the  injury  of  the  entire  purchasing  public.  That  is  the 
first  great  evil  of  monopoly. 

WOEK  FOE  ALL  FINALLY. 

The  difficulty  that  has  been  spoken  of  by  one  of  the 
members  of  this  conference,  who  represented  the  com- 
mercial travelers^  is  a serious  one,  the  displacement  of  the 
large  amount  of  labor.  Yet  that  is  the  same  trouble  which 
has  come  in  with  eA^ery  labor-saving  machine.  The  work 
of  the  world  is  sufficient  to  employ  all  hands  finally. 

These  great  corporations  are  now  seeking  the  avenues 
to  political  power.  They  are  now  seeking  to  enhance  their 


TKUSTS  —PRO  AND  CON. 


101 


“You  pays  your  money  and  you  takes  your  choice/' 

—From  the  Chicago  Daily  News. 


102 


TRUSTS — PRO  AND  CON. 


fortunes,  in  the  words  of  Judge  David  Davis,  often  by 
purchasing  legislatures  and  by  corrupting  officials. 

The  most  efficient  way  of  stopping  the  evil  of  the  trusts 
is  not  to  be  found  in  the  legislation  which  seeks  to  an- 
nihilate and  extinguish  them  altogether.  One  kind  of 
monopoly  may  be  as  dangerous  as  another.  The  same  con- 
dition that  exists  in  the  sugar  industry  is  the  ideal  to  which 
all  other  industries  seem  to  be  tending,  and  the  result  will 
be  to  reach  the  practical  ideal  which  has  been  realized  by 
the  sugar  trust,  that  is  controlling  practically  the  prices 
of  all  the  output  of  the  country. 

CENTEALIZATION  INEVITABLE. 

What  has  been  done  in  the  past  may  be  done  in  the 
future.  What,  then,  will  be  the  result?  As  the  nations  of 
the  world  have  been  growing  fewer  and  fewer,  yet  stronger 
and  stronger,  until  we  can  say  to-day  that  four  or  five  of 
the  greatest  of  them  control  all  the  future  destinies  of  the 
world,  so  the  industries  of  our  country  grow  greater  and 
greater,  embracing  a larger  and  larger  area,  tending  to  ab- 
sorb our  entire  industrial  life. 

All  I want  to  say  in  conclusion  is  that  there  is  a method 
that  m.ay  be  found  to  control  the  direction  of  these  corpora- 
tions, but  who  shall  invoke  that  which  shall  charm  the 
leviathan  of  the  sea  and  conduct  him  into  still  waters  of 
virtue  and  benevolence?  Whether  we  find  that  or  not, 
v/hether  we  will  or  no,  this  movement  will  go  on,  and  for 
the  most  part  all  we  can  do  is  to  stand  by  and  see  the  sal- 
vation of  the  land.  It  will  not  be  the  first  instance  in  his- 
tory or  the  development  of  mankind  where  agencies  that 
threatened  ruin  and  destruction  were  afterward  found  to 
be  the  ministers  of  blessing  and  prosperity. 

So  great  was  the  appreciation  by  the  audience  of  Mr. 
Foulke^s  speech  and  his  evident  good  nature  that  he  was 
called  to  the  front  of  the  platform  three  times  and  great 
cheers  and  cries  of  ^TouTe  all  right 


TRUSTS — PRO  AND  CON. 


103 


TRUST  REMEDIES. 


EDWARD  ROSEWATER. 

Chairman  Howe  then  presented  Edward  Eosewater, 
editor  of  the  Omaha  Bee,  who  explained  that  he  hesitated 
to  speak  in  the  presence  of  two  of  the  greatest  orators  in 
the  country,  and  that  he  imagined  he  would  not  be  on 
the  speakers’  list  at  all  but  for  the  fact  that  he  hailed  from 
Nebraska.  Proceeding^  he  said,  in  part: 

We  are  confronted  by  grave  problems  generated  by  the 
industrial  revolution  of  the  nineteenth  century.  The  trust 
is  but  the  outgrowth  of  natural  conditions.  The  trend  of 
modern  civilization  is  toward  centralization  and  concen- 
tration. This  tendency  is  strikingly  exhibited  in  the  con- 
gestion of  population  in  large  cities,  the  building  of  mam- 
moth hotels,  tenement  blocks,  sky  scraper  office  buildings, 
the  department  store  and  colossal  manufacturing  plants. 
The  monopolistic  combination  of  corporate  capital  known 
as  trusts  have  their  origin  in  overproduction  and  ruinous 
competition.  Honestly  capitalized  and  managed,  with  due 
regard  for  the  well-being  of  their  employes,  and  operated 
economically  for  the  benefit  of  consumers  of  their  prod- 
uct, these  concerns  are  harmless.  Within  the  past  decade 
the  trusts  have,  however,  for  the  most  part,  degenerated 
into  combinations  for  stock  jobbing.  Nearly  every  trust 
recently  organized  had  its  incentive  in  the  irresistible  temp- 
tation held  out  by  the  professional  promoter  to  capitalize 
competing  plants  at  from  five  to  ten  times  their  actual 
value.  This^  fictitious  capitalization  constitutes  the  most 
dangerous  element  of  the  modern  trust.  In  nearly  every 
instance  overcapitalization  becomes  the  basis  for  raising 
the  price  of  trust  products,  and  invariably  lays  the  founda- 
tion for  bank  failures,  panics  and  the  ills  that  follow  in 
their  train. 


104 


TRUSTS — PRO  AND  CON. 


DUTY  OF  THE  COYPEEENCE. 

The  imperative  duty  of  this  conference  is  to  devise  meas- 
ures that  will  make  the  trusts  harmless.  With  this  end  in 
view  it  should  recommend: 

1.  The  creation  by  act  of  congress  of  a bureau  of  super- 
vision and  control  of  corporations  engaged  in  interstate 
commerce  with  powers  for  its  relief  similar  to  those  exer- 
cised by  the  comptroller  of  the  currency  over  national 
banks. 

2.  Legislation  to  enforce  such  publicity  as  will  effect- 
ually prevent  dishonest  methods  of  accounting  and  restrict 
traffic  and  competition  within  legitimate  channels. 

3.  The  abrogation  of  all  patents  and  copyrights  held  by 
trusts  whenever  the  fact  is  established  before  a judicial 
tribunal  that  any  branch  of  industry  has  been  monopolized 
by  the  holders  of  such  patents  or  copyrights. 

4.  The  enactment  by  congress  of  a law  that  will  compel 
every  corporation  engaged  in  interstate  commerce  to  oper- 
ate under  a national  charter  that  shall  be  abrogated  when- 
ever such  corporation  violates  its  provisions. 

5.  The  creation  of  an  interstate  commerce  courts  with 
exclusive  jurisdiction  in  all  cases  arising  out  of  the  viola- 
tion of  interstate  commerce  laws. 

CONSTITUTIONAL  EEYISION. 

6.  In  order  that  the  constitutional  liniitations  and  de- 
cisions of  the  Supreme  Court  of  the  United  States  relative 
to  the  power  of  congress  to  regulate  and  control  trusts  may 
be  overcome^  the  conference  should  recommend  the  re- 
vision of  the  Constitution  of  the  United  States  by  a con- 
stitutional convention  to  be  called  by  two-thirds  of  the 
states  at  the  earliest  possible  date^  as  provided  for  by  article 
5 of  the  federal  Constitution. 

While  the  trusts  might  be  reached  by  a single  amend- 
ment to  the  Constitution^  I doubt  very  much  whether  any- 
thing could  be  gained  by  such  patchwork,  since  the  Consti- 
tution contains  many  other  provisions  that  would  consti- 
tute a bar  in  effecting  enforcement  of  the  interstate  com- 
merce law.  The  mode  of  procedure  for  securing  a single 
amendment  is,  if  anything,  more  cumbersome,  and  rati- 


TRUSTS — PRO  AKD  CON. 


105 


fication  thereof  more  difficult  to  push  than  would  be  a 
complete  revision  of  the  organic  law  of  the  land. 

If  you  will  examine  the  Constitution  you  will  see  that  it 
lies  within  the  power  of  the  states  to  call  a national  consti- 
tutional convention  whenever  two-thirds  have  concurred 
in  such  call^  whereas  the  ordinary  amendment  requires 
the  concurrence  of  two-thirds  of  each  of  the  houses  of 
congress,  which  is  very  difficult  to  procure  in  view  of  the 
tremendous  influence  exercised  over  the  senate  by  the  con- 
federated corporations. 


106 


TRUSTS — PRO  AND  CON. 


INDUSTRIAL  COMBINATIONS. 


HON.  W.  BOURKE  COCKRAN. 

W.  Bourke  Cockran  of  New  York  spoke  as  follows: 

Mr.  Chairman^  Ladies  and  Gentlemen:  There  is  no 
person  who  could  have  listened  to  the  papers  which  have 
been  read  from  this  platform  during  the  last  three  days 
and  doubt  for  a moment  that  the  object  of  this  gathering 
was  an  honest  search  for  truth.  (Applause.)  I think  the 
country  is  to  be  congratulated  upon  some  of  the  papers 
which  have  been  contributed  to  this  discussion,  notably 
those  that  came  from  the  representatives  of  the  labor  or- 
ganizations and  from  the  National  Grange.  (Applause.) 

Indeed,  as  I listen  to  the  conceptions  of  economic  law 
which  mark  every  address  to  which  I listen,  delivered  by 
representatives  of  organized  labor,  I become  convinced 
that  the  laborers  who  spoke  to  us  understood  these  laws 
much  better  than  their  employers;  indeed,  I believe  that 
some  recent  events  in  our  history  would  have  been  impos- 
sible if  both  sides  of  these  labor  controversies  understood 
the  economic  laws  governing  the  relation  of  producers  to 
consumers  as  well  as  one  side  showed  that  it  understood 
them  this  very  day. 

Now  I believe,  ladies  and  gentlemen,  that  the  pursuit 
of  truth  is  not  a hopeless  or  even  a difficult  task.  I am 
one  of  those  who  believe  that  in  any  assemblage  of  men 
honestly  endeavoring  to  discover  the  truth  she  always  ap- 
pears— not  necessarily  toward  the  adoption  of  the  sugges- 
tion of  any  one — more  often  through  the  partial  rejection 
of  all  suggestions.  Somehow  or  other  always  she  emerges, 
and  when  she  discloses  herself  her  excellence  is  so  trans- 
cendent and  conspicuous  that  all  recognize  her,  acknowl- 
edge her  and  proclaim  her. 

Now,  the  precise  question  which  we  have  been  called 
to  consider  is  the  effect  upon  the  general  prosperity  of  the 
community  of  combinations,  whether  of  capital  or  of  labor. 


TRUSTS — PRO  AND  CON. 


lor 


One  of  the  great  difficulties  in  a philosophical  inquiry  is 
the  i;se  of  vague,  sonorous  and  misleading  phrases,  which 
raise  clouds  of  passionate  declamation  about  the  difficulty 
or  the  problem,  obscuring  its  outlines  and  even  magnifying 
its  dimensions.  There  have  been  certain  words  which  have 
figured  so  much  in  the  controversies  that  have  arisen  over 
this  question  that  I find  great  difficulty  in  discussing  the 
facts  which  confront  us  on  account  of  certain  words  which 
excite  us.  (Laughter  and  applause.) 

DEFINITION  OF  PEOSPEKITY. 

I shall,  for  the  purpose  of  establishing  an  intelligent 
basis  of  discussion,  somewhat  free  from  these  terms  over 
which  men  have  become  moved  to  passionate  declamation, 
define  prosperity  as  an  abundance  of  commodities  fairly  dis- 
tributed among  those  who  produce  them.  Now  this  is  not 
a statement  of  true  conditions  separate  and  distinct,  but 
rather  a statement  of  two  aspects  of  one  difference.  For, 
my  friends,  I hope  to  establish,  before  I get  through,  that 
there  cannot  be  abundant  production  of  commodities  with- 
out an  extensive  distribution  of  them  in  the  form  of  wages. 

But  whether  this  distribution  is  not  as  effective  and  com- 
plete as  we  might  wish,  we  can  defer  consideration  of  that 
question  for  a moment,  and  we  can  all  agree  that  there  can- 
not be  any  distribution  if  there  is  not  production,  and  that 
there  cannot  be  an  extensive  distribution  unless 
there  is  an  abundant  production.  We  must  have 
commodities  to  distribute  before  we  can  distribute  them 
in  the  form  of  wages  or  of  profits.  If  this  definition  of 
prosperity  be  correct,  it  is  perfectly  plain  that  there  is  no 
reason  why  a sensible  man  should  grow  excited  either  to 
the  approval  or  resentment  at  a combination  merely  as 
such. 

COMBINATIONS  MAY  BE  GOOD  OE  BAD. 

A combination  may  be  good  or  bad,  according  to  its 
effect.  For  instance,  a combination  for  prayer  is  a church. 
All  good  men  would  subscribe  to  the  success  of  it.  (Laugh- 
ter.) A combination  for  burglary  is  a conspiracy.  All 
good  men  would  call  out  the  police  to  prevent  it.  (Laugh- 


108 


TKUSTS — PRO  AND  CON. 


ter.)  Any  industrial  system  which  operates  to  swell  the 
volume  of  production  should  be  commended;  anything  that 
operates  to  restrict  it  should  be  suppressed. 

Now,  whether  these  great  combinations  of  capital  or 
these  combinations  of  labor  operate  to  raise  prices  or  to 
reduce  them  is  a subject  about  which  there  has  been  a wude 
diversity  of  opinion,  not  merely  in  this  hall,  but  wherever 
economic  questions  have  been  discussed.  Some  contend 
that  the  tendency  of  these  combinations  of  capital  is  to 
cheapen  the  product.  Others  say  that  it  is  to  raise  the  price 
of  a product.  Now,  while  I am  fully  conscious  that  the 
movement  of  prices  depends  upon  many  forms,  or,  rather, 
perhaps,  I should  say,  upon  every  force,  upon  the  bounty  of 
the  earth,  upon  the  sun  that  quickens  the  crop,  .upon  the 
rains  that  refresh  it,  upon  the  rivers  that  wash  the  soil  in 
which  it  is  imbedded  and  fructifying,  as  well  as  upon  the 
industry  of  man,  yet  I venture  to  say  that  neither  side  of 
this  controversy  is  wholly  right  or  wholly  wrong.  There 
are  some  combinations  w'hich  operate  to  raise  prices,  and 
some  which  operate  to  depreciate  them.  Now,  if  I accept 
either  I should  offend  against  that  other  offender  of  which 
I complain. 

SUGGESTS  A TEST. 

It  will  be  idle  to  say  that  some  improve,  that  some  raise 
prices  and  some  depreciate  them,  if  we  did  not  prescribe 
some  test  by  which  we  could  distinguish  between  the  two. 
Now,  ladies  and  gentlemen,  I think  it  is  a simple  one,  per- 
fectly clear.  The  test  is  to  ascertain  whether  the  com- 
bination of  capital  flourishes  through  government  aid  or 
without  it,  for,  my  friends,  you  must  see  that  any  industrial 
enterprise  which  dominates  the  market  without  aid  from 
the  government  must  do  so  through  cheapening  the  prod- 
uct, or  as  it  is  commonly  called,  by  underselling  compet- 
itors. 

An  industry  which  at  one  and  the  same  time  reduces 
prices  and  swells  its  own  profits  must  accomplish  that  re- 
sult by  increasing  the  volume  of  its  production.  (Ap- 
plause.) On  the  other  hand,  an  industry  which  dominates 
the  market  by  the  favor  of  government,  direct  or  indirect, 
cannot  in  the  nature  of  things  be  forced  to  cheapen  prices. 


TRUSTS — PRO  AND  CON. 


109 


because,  if  it  could  dominate  the  market  by  underselling 
competitors  in  an  open  field  without  favor,  it  would  not 
need  be  government  favor.  (Applause.)  The  interference 
of  the  government  would  be  an  injury  and  not  a benefit 
to  it. 

An  industry  or  a combination  of  capital^  or  anything  you 
may  choose  to  call  it,  that  dominates  a market  through  a 
restricted  competition,  that  delivers  the  consumer  to  it  on 
its  own  terms,  necessarily  depends  upon  a narrow  output 
and  large  profits^  extorted,  not  from  the  excellency  of  its 
service,  but  from  the  helplessness  of  those  with  whom  it 
deals.  (Applause.) 

Now,  there  are  three  ways  in  which  the  government  in- 
terferes in  the  trade  of  individuals  in  this  country — one  is 
by  patent  laws.  It  is  my  purpose,  ladies  and  gentlemen, 
to-night,  to  try  and  emphasize  the  points  on  which  we  can 
agree,  and,  if  possible,  by  some  suggestions,  to  extend  the 
scope  and  field  of  our  agreement,  but  waste  no  time  upon 
questions  which  cannot  possibly  be  settled  by  this  confer- 
ence, and  on  which  this  conference  can  have  very  little 
effect.  Therefore,  I will  not  waste  time  in  discussing  pat- 
ent laws. 

The  other  means  by  which  the  government  interferes  is 
by  tariff.  Now  I believe  that  every  person  can  concede, 
whether  he  believes  in  high  tariff  or  free  trade,  that  so  far 
as  trusts  are  concerned  the  tariff  operates  to  favor  them  in 
this  way,  and  in  this  way  only.  It  operates  to  restrict  com- 
petition in  the  production  of  any  article  to  those  engaged 
in  it  in  this  country.  But  if  a trust  or  combination  is  to  be 
formed,  manifestly  it  aids  the  enterprise  where  the  field  of 
competition  is  originally  limited.  Under  a condition  of 
free  trade  every  article  which  is  produced  is  exposed  to  the 
competition  of  the  whole  world.  If  you  rely  upon  the  com- 
bination to  suppress  competition,  manifestly  it  is  easier  to 
make  a combination  between  the  products  in  one  country 
than  in  all  countries,  and  to  that  extent  the  tariff  favors 
trusts.  (Applause.) 

Now,  it  is  well  to  say,  so  as  to  avoid  what  might  be 
called  the  field  of  political  controversy,  that  the  protec- 
tionist claims  that  the  exclusion  of  foreign  competition  in 
some  way  or  other  develops  a domestic  competition  much 


110 


TRUSTS — PRO  AND  CON. 


keener  and  in  some  mysterious  method  more  beneficent. 
I do  not  understand  his  logic,  but  I think  that  is  a fair 
statement  of  his  principles.  Now,  the  tariff  has  been 
thought  out  in  this  country  for  some  eight  or  ten  years. 
There  has  been  universal  debate  on  it,  and  the  question  is 
yet  unsettled.  We  cannot  hope  to  do  much  toward  its 
adjustment  here,  so  we  will  pass  from  the  tariff. 

GOVERNMENT  FRANCHISES. 

There  is  still  a third  and  serious  question  which  I think 
we  can  deal  with,  and  which  I believe  is  vastly  more  ex- 
tensive in  its  results  than  this  tariff  in  favor  of  trusts.  And 
I refer  to  those  favors  which  are  extended  to  certain  in- 
dustries or  corporations  enjoying  government  franchises, 
which  are  none  the  less  government  agencies  because  their 
stock  is  owned  by  private  individuals.  And  here  we  are 
face  to  face  with  a serious  difficulty.  First,  I must  assume 
it  a serious  difficulty  because  it  is  almost  impossible  to  de- 
scribe it.  It  is  surrounded  by  secrecy.  That  it  is  existing 
and  does  exist  everybody  believes,  but  for  the  purposes  of 
philosophical  discussion  it  is  impossible  to  try  to  follow 
that  which  you  cannot  even  fully  describe,  and  the  worst 
feature,  therefore,  of  this  outrage  which  is  perpetrated 
against  a certain  class  of  the  community  is  that  it  is  shroud- 
ed in  mystery. 

But,  my  friends,  you  must  remember  that  no  person  can 
enjoy  a favor  at  the  hands  of  any  company  enjoying  a pub- 
lic franchise  except  at  the  expense  of  another.  It  is  true 
of  every  instance  where  government  favors  an  individual. 
I have  said  in  many  places,  and  I say  here,  that  government 
cannot  at  one  and  the  same  time  be  a fountain  of  generos- 
ity and  of  justice.  (Applause.)  Government  cannot  create 
anything.  It  cannot  cause  the  boards  that  constitute  this 
desk  to  take  their  places  and  become  a useful  article  of 
furniture;  it  cannot  call  the  elements  of  this  structure  into 
place  and  command  them  to  become  a building;  it  cannot 
cause  two  blades  of  grass  to  grow  where  but  one  grew  be- 
fore or  make  the  barren  field  fruitful.  Now,  if  government 
cannot  create  anything  it  has  nothing  of  its  own  to  bestow. 
If  it  undertakes  to  enrich  one  individual,  the  thing  that  it 
gives  to  him  must  be  taken  from  another.  (Applause.)  A 


TKUSTS — PEO  AND  CON. 


Ill 


government  cannot  be  just  and  generous  at  the  same  time, 
for  if  it  be  generous  to  one  it  must  be  oppressive  to  another. 
If  it  do  a favor  it  must  have  a victim.  And  that  govern- 
ment only  is  just  and  beneficent  which  has  neither  favor- 
ites nor  victims. 

The  most  that  you  can  expect  to  make  of  a perfect  gov- 
ernment is  a just  one.  That  is  to  say,  an  impartial  govern- 
ment. Government  is  always  just  and  always  beneficent 
when  it  is  absolutely  impartial,  but  not  merely  must  its 
own  hands  be  impartial,  but,  to  paraphrase  Lord  Bacon, 
^The  hands  of  its  hands^^  must  be  impartial;  not  merely 
must  its  laws  be  impartial,  its  courts  impartial,  its  execu- 
tive officers  impartial,  but  the  agencies  that  it  empowers 
to  discharge  functions  essentially  public  must  be  impartial 
in  that  service  to  every  human  being  within  the  limits  of 
the  state.  (Great  applause.) 

DISCKIMINATION  IN  RATES. 

Now,  I have  said  that  these  favors  are  extended,  by  the 
common  belief,  and  I have  said  and  acknowledged  that  if 
one  person  attains  rates  which  are  excessively  favorable,  if 
his  goods  are  transported  at  a loss,  why,  other  men  using 
that  same  facility  must  make  good  the  loss.  If  goods  are 
transported  from  Chicago  to  New  York  for  anybody  for 
less  than  they  cost,  why,  that  must  be  made  up  by  the 
commerce  of  hundreds  of  others  who  pay  too  much. 

What  is  the  remedy?  A simple  one,  I believe.  Some 
gentlemen  have  suggested  municipal  ownership.  (Ap- 
plause.) Ladies  and  gentlemen,  I have  no  quarrel  with 
the  applause  of  municipal  ownership.  I concede  the  prin- 
ciple of  it.  (Applause.)  The  government  has  no  right  to 
empower  any  private  agency  to  perform  a function  unless 
it  be  one  which  the  government  would  be  bound  itself  to 
perform  if  that  agency  were  not  to  be  found.  (Applause.) 
The  only  excuse  for  empowering  a private  corporation  to 
discharge  a public  function  is  the  excuse  that  the  service 
will  be  more  efficient.  The  question,  then,  of  municipal 
ownership  is  a mere  question  of  expediency.  Can  a gov- 
ernment administer  a railway,  a gas  company  or  a street 
railway  as  well  as  private  individuals,  with  that  strong, 
powerful  incentive  in  the  shape  of  a hope  of  profit,  and 


112 


TRUSTS — PRO  AND  CON. 


with  the  peculiar  capacity  which  is  developed  by  years  of 
experience?  I won^t  debate  it  here^  for  this  reason,  that  if 
it  be  a remedy  it  is  such  a remote  one  that  a discussion 
of  it  would  be  a discussion  of  the  interests  of  our  children 
rather  than  of  ourselves.  (Laughter  and  applause.) 

There  are  many  grave  questions  to  be  considered  be- 
fore a municipal  ownership  could  be  reduced  to  practical 
operation,  even  though  we  would  now  set  about  the  task. 
There  are  questions,  for  instance,  as  to  the  rate  of  valua- 
tion. Would  we  take  them  at  what  it  would  cost  to  re- 
produce them,  or  at  their  earning  power?  If  you  say  you 
v/ill  take  them  at  their  earning  power  I tell  you  you  would 
have  rather  a doubtful  speculation.  It  is  doubtful  if  you 
could  take  them,  if  the  government  could  take  them,  cap- 
italized at  their  present  rates,  and  make  them  pay.  If  you 
take  them  at  what  it  would  cost  to  reproduce  them  you  are 
brought  face  to  face  with  the  question  as  to  whether  you 
have  any  right,  after  the  state  stood  by  and  encouraged 
the  original  holders  of  these  franchises  to  sell  the  capital 
which  was  issued  upon  them  to  innocent  holders  at  the 
value  that  might  be  put  upon  its  earning  power,  and  then 
take  it  back  from  them  on  a different  valuation. 

Outside  of  the  question  of  ethics  and  justice  you  have 
questions  of  constitutional  law  to  study,  and  on  the  whole 
I consider  the  suggestion  of  municipal  ownership  as  highly 
ingenious  and  highly  interesting,  but  the  suggestion  of  a 
constitutional  convention  to  frame  a new  constitution  for 
the  United  States  is  somewhat  remote.  (Applause.) 

PUBLICITY  A SAFEGUAED. 

Now,  is  there  any  practical  remedy  that  this  conference 
can  suggest  that  can  be  put  in  force  to-morrow  by  any 
legislature  that  happens  to  be  in  session?  My  friends,  it 
seems  to  me  to  be  a very  simple  matter.  The  fact  is,  you 
would  not  have  to  ask  the  law  to  denounce  special  rates 
to  individuals;  that  is  the  law  to-day.  The  remedy,  then, 
is  simply  to  define  a practical  penalty,  a serious  one,  and 
then  provide  for  publicity;  and  you  provide  the  proper 
statute  of  publicity  aud  you  need  not  enforce  the  penalty. 
An  officer  of  a corporation  granting  a special  favor  to  any 
person  who  has  a right  to  use  that  possession  on  equal  terms 


TRUSTS — PRO  AND  CON. 


113 


with  eyerybody  else  ought  to  be  held  guilty  of  a serious 
felony. 

No  tines,  no  judicial  rebukes,  no  denunciation  from  plat- 
forms, no  legislative  enactments  declaring  things  are  rep- 
rehensive  will  touch  the  subject,  but  a specific  enactment 
that  a special  rate  granted  to  any  one,  not  enjoyed  by  the 
others,  is  a felony,  and  proper  means  to  punish  it  will  do 
something  toward  checking  it,  and  my  friends,  this  is  not 
any  inconsiderate  statement;  it  is  a crime  of  the  first  mag- 
nitude. The  public  official  in  the  control  of  any  great 
public  franchise,  who  gives  to  one  man  opportunities 
at  the  expense  of  the  other,  robs  that  other,  if  not  of  the 
property  in  his  possession,  of  the  opportunity  to  acquire 
property.  (Applause.) 

Now,  with  a statute  authorizing  and  making  it  the  right 
of  every  shipper^  of  every  person  using  a public  franchise, 
to  have  disclosed  to  him  at  any  time  every  contract  and 
agreement  made  with  any  other  person,  you  will  find  there 
will  be  little  difficulty  about  avoiding  the  enforcement  of 
the  penal  statute,  for  it  will  not  be  transgressed.  We  want 
a simple  statute  of  publicity,  and  I believe  that  will  check 
the  special  favors. 

While  I am  on  the  subject  I think  it  wise  to  advert  to 
what  many  call  a phenomenon — that  is,  the  public  dislike 
and  distrust  or  hatred  of  corporations.  Ladies  and  gentle- 
men, I donT  share  that  hatred  or  dislike,  but  I understand 
it.  I donT  think  it  is  wholly  justified,  yet  I think  an  ex- 
amination of  the  history  of  corporate  management  will 
show  some  justification. 

ON  OVEECAPITALIZATION. 

We  have  heard  much  about  overcapitalization  as  one  of 
the  evils  to  be  treated  in  this  conference.  In  one  sense  I 
think  overcapitalization  is  a matter  of  no  public  mo- 
ment. In  another  I think  it  has  a serious  aspect.  It  mat- 
ters very  little  how  I capitalize  an  enterprise  in  itself.  If  I 
capitalize  it  at  $100,000  and  it  is  earning  $10,000  a year, 
the  public  would  immediately  put  the  shares  at  100  per 
cent  premium,  and  that  v/ould  be  quoted  at  200.  It  would 
make  no  difference  whether  I capitalized  at  $100,000  or 
$200,000.  If,  on  the  other  hand,  I capitalized  at  $400,- 


114 


TKUSTS — PRO  AND  CON. 


000  the  shares  would  sell  at  50^  and  that  would  not  make 
very  much  difference. 

When  the  gentleman  who  opened  this  conference — Pro- 
fessor Jenks — in  the  admirable  statement  which  placed  the 
issues  for  our  consideration  so  clearly  before  us^  he  meant 
to  restrict  this  question  of  overcapitalization  to  the  in- 
stance of  a newspaper  which  was  earning  $100^000  a year. 

1 think  it  was  $1,000^000,  and  yet  it  could  be  reproduced 
for  $100,000 — all  except  the  editor  (laughter),  and  he 
asked,  ^^Is  it  fair?  How  are  you  going  to  capitalize  that?^^ 
The  answer  is  very  simple — tell  the  truth  to  the  public 
about  what  you  have  got  and  capitalize  it  as  you  please. 
(Laughter.) 

I can  imagine  a case,  for  instance,  where  an  increase  of 
capitalization  with  any  additional  capital  might  be  a very 
salutary  thing.  Assume,  for  a moment,  that  the  Western 
Union  Telegraph  Company  should  reduce  the  rates  on 
telegrams  to  5 cents  a hundred,  and  it  w'ould  double  its 
profits,  would  anybody  object  to  its  capitalization  on  that? 
If,  on  the  other  hand,  it  should  undertake  to  double  its 
profits  by  doubling  the  cost  of  the  telegrams  to  the  public, 
then  I would  believe  in  invoking  every  implement,  legis- 
lative and  executive,  to  prevent  such  an  outrage  upon  the 
public. 

CALLS  IT  A SWINDLE. 

If  an  ordinary  industry  capitalizes  for  $5,000,000,  know- 
ing that  it  could  not  pay  dividends  upon  $1,000,000,  and 
then  without  any  positive  falsehood  deceives,  by  what  is 
commonly  called  finance  ^^scenery,^^  so  as  to  induce  the  pub- 
lic to  buy  at  a fictitious  value,  I call  that  a swindle,  and  it 
would  be  called  a swindle  if  it  is  perpetrated  against  a shoe 
dealer  on  the  Bowery,  Avhere  it  is  often  called  an  operation. 
(Laughter  and  applause.)  Now,  my  friends,  the  remedy 
for  all  evils,  in  my  judgment,  is  the  original  remedy  which 
1 suggested — publicity,  publicity. 

The  hatred  of  corporations,  which,  as  I say,  is  not  wholly 
justified,  is  not  discreditable  to  the  public  opinion  of  Amer- 
ica. In  fact,  I lay  it  down  as  a cardinal  rule,  which  I think 
any  person  can  follow  with  perfect  safety,  that  wherever 
you  find  a general  opinion  on  any  subject  in  America  there 


TRUSTS — PRO  AND  CON. 


115 


is  always  a pretty  good  ground  for  it.  (Applause.)  The 
distrust  of  corporations  arises  not^  in  my  judgment^  from 
any  well-considered  dislike  to  corporate  entities. 

My  friend  from  Texas,  whose  eloquent  periods  moved 
this  body  as  I have  not  seen  it  moved,  on  the  first  day  of 
our  session,  was  careful  to  distinguish  between  corporations 
which  acted  for  the  public  good  and  those  which  acted  for 
the  oppression  of  the  public.  I am  not  quite  sure  that  I 
understood  the  distinction  from  his  words,  but  I think  he 
and  I perfectly  sympathized  in  our  feelings.  We  do  not 
object  to  the  principle  of  co-operation.  Corporate  exist- 
ence is  the  natural  evolution  of  the  partnership;  it  is  a 
scheme  by  which  men,  strangers  to  each  other,  can  co-op- 
erate in  production;  while  partnership  was  a scheme  lim- 
ited to  men  who  knew  each  other  and  were  compelled  to 
work  together.  But  the  management  of  corporations  has 
been  the  blackest  page  in  all  our  history. 

The  public  indignation,  unfortunately,  which  ought  to 
be  expended  upon  the  corporate  management  which  is  re- 
sponsible for  this  shame,  has  too  often  been  visited  upon 
the  stockholders  and  the  corporations  themselves,  who  have 
been  the  victims  of  that  infamy.  It  is  a chapter  which  is 
perhaps  the  blackest,  as  I have  said,  in  our  history,  this 
whole  question  of  corporate  management.  If  you  read  the 
details  of  it  it  will  fill  you  with  a sense  of  shame  for  your 
country.  You  have  only  got  to  look  back  to  the  history 
of  the  panic  of  1873,  and  the  history  of  the  panic  of  1893, 
and  the  corporate  management  that  preceded  that  panic, 
to  find  corporations  wrecked  and  looted  by  those  to  whose 
bands  they  were  intrusted — their  treasuries  empty,  worth- 
less property  sold  to  them,  that  were  but  small  and  thin 
disguises  of  truth.  They  were  injured,  robbed  and  out- 
raged until  deprived  of  property  and  credit,  and  then  sent 
over  the  precipice  of  insolvency  in  a condition  so  rotten 
that  their  fall  was  noiseless.  (Applause  and  laughter.) 

ISTow  all  this  story  of  infamy  and  of  wrong  and  of  per- 
fidy and  of  fraud  has  not  brought  one  hour  of  shame  or 
humiliation  to  those  who  have  perpetrated  it.  They  are 
walking  the  streets  to-day,  their  heads  high  in  the  world 
of  finance.  To  the  best  informed  the  story  is  only  partially 
known;  to  the  vast  mass  of  the  people  it  is  a sealed  book. 


116 


TRUSTS — PRO  AND  CON. 


DIKECTOES  ESCAPE  PUNISHMENT. 

Why^  we  talk  about  the  corruption  of  municipal  corpor- 
ations. Well,  they  probably  are  corrupt — certainly  not 
more  so  than  they  are  believed  to  be.  (Laughter.)  But  the 
government  of  corporations,  notwithstanding  that  year 
after  year  we  see  evidences  of  the  recklessness  with  which 
it  has  been  conducted,  the  fraud  which  has  characterized  its 
management — I donT  believe  that  in  the  whole  history  of 
jurisprudence  there  has  been  a case  in  which  a director  has 
been  compelled  to  answer  for  it.  These  frauds  are  perpe- 
trated in  insidious  methods.  The  public  is  fooled  as  to  the 
value  of  the  stock  by  specific  statements;  interest  is  paid 
upon  bonds  which  has  never  been  earned,  and  the  public 
believes  them  solvent.  It  pays  its  fixed  charges  and  the 
public  buys  the  stock,  even  though  no  dividends  have  been 
paid,  believing  that  dividends  are  soon  to  be  paid  because 
the  fixed  charges  are  met;  interest  is  paid  on  the  preferred 
stock  which  never  has  been  earned  that  the  common  stock 
may  be  fioated;  but  when  the  collapse  comes,  when  the 
ruin  is  complete,  in  nine  cases  out  of  ten  the  engineers  of 
this  ruin  are  appointed  the  receivers  by  the  courts  in  order 
to  conduct  the  plan  of  reorganization. 

Mr.  Gompers  spoke  to-day  about  complaints  which  the 
labor  organizations  have  made  against  the  courts  for  in- 
terfering with  their  operations,  adjudications  of  these 
unions  by  injunction.  Well,  I donT  suppose  I can  stop 
here  to  talk  about  government  by  injunction.  .That  is  a 
political  phrase.  So  we  must  exclude  it  from  discussion. 
But,  ladies  and  gentlemen,  I will  say  this:  It  has  always 
been  to  me  a source  of  profound  regret  that  the  courts  show 
so  much  ingenuity  in  devising  injunctions  to  prevent  cor- 
porations from  being  disturbed  by  their  employes,  but 
have  not  shown  one-half  that  ingenuity  in  devising  meth- 
ods to  prevent  their  being  robbed  by  their  directors. 

ONE  EEMEDY. 

To  all  this,  my  friends,  the  remedy,  I repeat,  is  pub* 
licity.  A statute  which  would  modify  but  slightly,  if  at  all, 
the  existing  laws  of  every  state  would  make  this  species  of 
fraud  impossible,  and,  while  I believe  that  it  is  possible  that 


TRUSTS — PRO  AND  CON. 


iir 


Ijiis  conference  may  reach  a unanimous  conclusion^  because 
CA^ery  person  who  has  spoken  upon  the  subject — the  pro- 
fessors of  political  economy  from  the  colleges^  the  master 
of  the  national  grange — every  person  who  has  discussed 
the  problem,  has  agreed  that  publicity  is  the  remedy  for 
this  species  of  corporate  fraud  and  for  unfair  and  unjust 
discriminations  among  those  who  are  compelled  to  use 
them,  what  objection  can  there  be  to  it? 

SECKECY  A BADGE  OF  FEAUD. 

Why,  they  tell  you  it  is  private  business.  ISTever  pri- 
vate business  when  you  are  called  upon  to  discharge  a trust 
on  behalf  of  those  who  are  not  alv/ays  at  your  elbow  to 
see  how  that  trust  is  discharged.  (Applause.)  No  hon- 
est man  ever  yet,  discharging  a duty  for  another,  clainied 
the  cloak  of  secrecy.  That  is  the  badge  of  fraud.  (Ap- 
plause.) No  corporation  has  a right  to  secrecy  in  the  dis- 
charge of  its  duties.  Whenever  any  person  seeks  to  lure 
you  up  a dark  alleyway  on  the  pretense  that  he  is  going 
to  serve  you,  do  not  parley  with  him  a moment;  he  is  a 
confidence  man.  Call  a policeman  if  you  want  to  save 
your  property  or  your  character. 

No  corporation  anxious  to  perform  honest  service  to 
the  public  and  its  stockholders  will  seek  secrecy  or  will 
insist  upon  it.  Eemember  that  this  secrecy  is  not  invoked 
by  corporate  members  against  the  public  any  more  than  it 
is  against  their  own  stockholders.  It  is  the  cloak  behind 
which  all  these  frauds  are  perpetrated.  The  payment  of 
interest,  the  false  pretense  of  paying  dividends  which  have 
not  been  earned;  false  pretenses  about  earnings;  false  pre- 
tenses made  up  of  false  bookkeeping;  all  these  are  possi- 
ble while  the  managers  of  a corporation  have  the  right  to 
close  their  offices  in  the  face  of  their  own  shareholders  and 
say  that  this  is  a matter  which  concerns  the  management. 

Ladies  and  gentlemen,  we  have  but  to  provide  a sim- 
ple statute;  first,  that  any  stockholder — as  they  have  in 
England,  as  Professor  Brooks  pointed  out  here  the  first 
day  of  the  session — shall  have  the  right  to  examine  the 
books  of  a company  and  know  everything  about  its  con- 
cerns, although  he  owns  but  one  share.  If  they  find  it  too 
onerous  to  allow  the  owner  of  one  share  of  $200  to  ex- 


118 


TRUSTS^ — PRO  AND  CON. 


amine  their  books  at  leisure,  then  let  them  raise  their 
shares  to  $1,000  or  $10,000  or  $15,000^  and  let  the  mini- 
mum shareholder  be  entitled  to  examine  the  books.  But 
when  they  issue  stock  at  $100  a share^  or  $50  a share^  and 
any  member  of  the  public  becomes  a member  and  an  own- 
\ er  of  that  stock,  and  a shareholder  of  that  corporation,  he 
should  have  the  right  to  examine  those  books  whenever  he 
chooses.  And  that  is  the  law  to-day  if  the  courts  would 
enforce  it.  (Applause.) 

In  addition  to  that  every  corporation  should  be  com- 
pelled to  file  with  the  secretary  of  state,  when  it  organizes, 
a statement  of  property,  and  then  let  the  public  buy  at  any 
capitalization  it  chooses  to  make.  Every  year  it  should 
report  to  some  competent  authority  a full  statement  of  its 
business.  That  is  the  law  to-day  in  nearly  every  state,  and 
it  is  always  evaded.  The  reports  are  misleading  where  they 
are  not  incomprehensible.  Let  these  reports  be  fair,  hon- 
est statements  of  their  business,  and  then  finally  extend 
the  powers  of  your  superintendents  of  insurance  and  bank- 
ing to  all  corporations,  and  let  these  reports  be  verified,  and 
then  you  will  have  honest  management  of  corporations,  and 
I promise  you  that  this  public  distrust  and  hatred  of  cor- 
porate entities  will  disappear  from  the  minds  of  a liberty- 
loving  people,  who  are  but  seeking  justice  even  through 
their  prejudice.  (Applause.) 

Now,  so  much  for  the  interference  of  government  in 
the  affairs  of  the  citizen  and  monopolies  resting  upon  it. 
I have,  as  you  will  remember,  mentioned  a form  of  indus- 
trial organization  which  dominates  the  market,  not  through 
government  favor,  but  through  the  cheapness  of  its  prod- 
uct. Against  the  monopoly  that  depends  upon  govern- 
ment, favored  in  any  shape  or  form,  I am  as  truly  opposed 
as  any  gentleman — even  from  Texas.  (Laughter.)  I con- 
fess that  I envy  Texas  its  breezy  rhetoric  when  I want  to 
denounce  that.  (Laughter  and  applause.)  But,  my  friends, 
when  we  come  to  consider  organizations  which  dominate 
the  market  without  any  aid  from  the  government,  why, 
then,  we  are  face  to  face  with  a proposition  which  is  of 
radically  opposite  character. 

Now  let  us  see  what  the  objection  to  that  is.  We  are 
told  that  it  defeats  competition;  but,  my  friends,  that  is  an 


TRUSTS — PRO  AND  CON. 


119 


obvious  mistake.  I must  say  to  begin  with  that  any  in- 
dustrial organization  that  cheapens  to  me  the  cost  of  some- 
thing I need  I regard  as  a benefit,  and  I cannot  possibly 
bring  myself  to  quarrel  with  it.  (Laughter.)  I cannot 
quarrel  with  it  even  if  you  call  it  a monopoly.  I must 
make  this  confession  frankly  before  this  gathering,  that  if 
I can  go  to  a department  store  (which  I believe  is  a form 
of  monopoly  very  oifensive  to  some  gentlemen),  or  to  any 
other  kind  of  trust  and  get  a good  suit  of  clothes  for  $40, 
why,  I would  rather  go  there,  and  would  go  there,  than  to 
a small  tailor  and  pay  him  $50. 

This  may  be  a confession  of  total  depravity.  (Laughter 
and  applause.)  But  I hope,  ladies  and  gentlemen,  you  will 
at  least  give  me  credit  for  the  candor  which  prompts  it.  I 
think  I said  at  the  beginning  that  we  must  be  very  careful 
about  getting  excited  over  words.  Now  there  is  a word 
here  which  I must  use,  and  that  is  the  word  monopoly. 
You  will  observe  that  I strictly  avoided  the  word  ^TrusV^ 
which  was  originally  a term  of  highly  respectable  signifi- 
cance, but  which  seems  to  have  fallen  into  disrepute  by  its 
association  with  millionaires,  and  so  far  as  possible  I ex- 
clude its  use. 

I have  heard  gentlemen  here  speak  about  ^^partial  monop- 
olies.^^ I confess  I do  not  understand  what  that  means. 
A partial  monopoly  is  very  much  to  me  like  a partial  whole. 
(Laughter.)  If  we  are  to  have  a monopoly  I can  under- 
stand that  (laughter);  but  I cannot  quite  understand  a 
partial  monopoly.  But  then  you  must  remember  that  that 
is  an  economic  subject,  and  combinations  of  capital  have 
given  rise  to  an  extraordinary  number  of  phrases  which  I 
do  not  claim  to  understand. 

MONOPOLY  HAS  A BAD  NAME. 

Monopoly  is  a word  which  suffers  from  a very  bad  name, 
and  deservedly  so.  It  has  been  associated  for  ages  with 
the  very  worst  form  of  governmental  practice.  During  the 
whole  history  of  the  world,  until,  I may  say,  this  genera- 
tion, monopoly  represented — rather,  it  controlled — the 
market  by  government  patent.  It  meant  a license  to  some 
government  favored  to  prey  upon  the  necessities  of  the 


120 


TRUSTS — PRO  AND  CON. 


community;,  and  the  mention  of  the  word  naturally  awak- 
ens the  indignation  of  every  liberty-loving  freeman. 

I do  not  believe  that  there  is  any  single  industry  ex- 
isting in  this  country  to-day  that  is  a monopoly  in  the 
sense  in  which  that  word  can  be  used.  I believe  the  Stand- 
ard Oil  Company;,  which  is  generally  considered  the  lead- 
ing monopoly;,  supplies  about  62  per  cent  of  the  entire 
product  of  all  its  consumers.  But  I suppose  a better 
word  would  be  a dominating  industrial  enterprise — one 
that  dominates  the  market;  that  leadS;,  not  that  has  the 
largest  measure  of  the  total.  I do  not  object  even  if  you 
call  the  institution  that  gives  me  my  clothes  the  cheapest 
a monopoly.  I will  not  quarrel  with  the  words.  I do  not 
care  which  term  you  use  as  much  as  I do  about  the  clothes. 
(Laughter.)  But  it  must  be  borne  in  mind  that  the  gen- 
tlemen who  object  to  this  form  of  domination  or  monopoly, 
call  it  what  you  will,  on  the  ground  that  it  destroys  com- 
petition, are  wholly  illogical.  It  does  not  destroy  com- 
petition. It  is  the  very  product  of  competition.  Ladies 
and  gentlemen,  you  cannot  have  competition  without  com- 
petitors, and  if  you  have  competitors  one  must  prevail.  If 
you  do  not  allow  the  man  who  prevails  in  the  competi- 
tion the  fruit  of  his  victory  he  will  not  compete,  and  no- 
body else  will,  and  then  you  will  have  no  competition. 
(Laughter  and  applause.) 

EXCELLENCE  IS  MONOPOLY. 

The  competition  of  men  in  any  department  of  human 
endeavor,  if  it  be  absolutely  free,  always  develops  excel- 
lence, and  excellence  is  monopoly.  It  would  not  be,  ex- 
cellence if  it  wasnT.  You  would  surely  not  call  that  ex- 
cellence which  is  shared  by  many.  Now,  if  any  number  of 
persons  competing  to  supply  me  with  clothing  and  with 
shoes  and  with  food  and  with  shelter  have  among  them  one 
standing  pre-eminently  able  to  render  me  the  best  service 
of  all,  he  does  not  suppress  competition,  he  is  the  com- 
petitor; he  is  the  successful  competitor,  and  if  you  do 
iiot  allow  him  the  fruits  of  his  success  you  destroy  competi- 
tion. (Laughter  and  applause.)  He  who  sells  cheapest 


TRUSTS — PRO  AND  CON. 


121 


must  always  dominate  the  market^  for  in  economics  the 
domination  of  the  cheapest  is  the  survival  of  the  fittest. 

Now,  I have  heard  it  said,  as  an  objection  to  this,  that 
the  successful  industry,  by  serving  me  so  well  throws  the 
men  who  cannot  serve  me  so  well  out  of  employment. 
Well,  I might  say  in  the  first  place  that  I do  not  believe 
it.  These  great  industrial  trusts  I do  not  believe  have 
thrown  anybody  out  of  employment  who  deserves  employ- 
ment. To  begin  with,  the  man  who  says  that  any  com- 
bination throws  him  out  of  employment  because  he  can- 
not compete  with  it  admits  that  somebody  else  can  do  his 
job  better  than  he  can,  and  if  so  he  ought  to  give  it  up. 
(Applause.) 

And  so,  where  a society  is  passing  through  an  experience 
and  a man  thinks  he  is  going  to  be  thrown  out  of  em- 
ployment he  yells  and  screams  and  shouts  a great  deal 
more  than  he  will  ever  do  after  he  has  actually  gone 
through  it. 

STAGE  DEIVEES  WEEE  AEEAID. 

You  may  remember — I donT  suppose  any  of  the  ladies 
and  gentlemen  here  will  remember — but  all  are  familiar 
with  the  history  of  the  development  of  the  railway.  There 
was  not  probably  in  the  history  of  man  a danger  that  was 
apprehended  to  such  an  extent  as  the  danger  that  the 
stage-coach  drivers  cherished  when  they  believed  that  the 
construction  of  a railroad  would  throw  every  one  of  them 
out  of  employment.  I think  I could  demonstrate  here 
that  anything  which  cheapens  a commodity  or  article,  and 
therefore  increased  the  volume  of  the  commodity,  can- 
not throw  anybody  out  of  employment. 

As  soon  as  the  railroads  became  so  far  organized  that  the 
stage  coach  was  driven  out  the  demand  for  drivers  and 
horses  to  distribute  merchandise  and  passengers  from  rail- 
way stations  was  more  than  three  times  greater  than  the 
demand  for  drivers  of  stage  coaches.  It  is  quite  true  that 
some  stage-coach  drivers  who  had  been  driving  a four-in- 
hand  from  London  to  Brighton  could  not  bring  them- 
selves down  to  the  driving  of  merchandise  wagons  and  pas- 
sengers, but,  says  I,  ^^Are  you  going  to  block  the  wheels 


122 


TRUSTS — PRO  AND  CON. 


of  progress  for  the  benefit  of  the  stage-coach  driver?^’ 
(Langhter  an^  applause.) 

When  there  was  constructed  a machine  for  the  manu- 
facture of  shoes  the  cobbler^  in  his  cellar,  bemoaned  his 
fate,  and  wus  calculating  upon  the  number  of  days  that 
would  intervene  between  himself  and  starvation;  and  the 
weaver,  working  for  a miserable  pittance  in  a back  room, 
whose  condition  was  as  bad  as  the  condition  of  the  woman 
immortalized  in  Hood^s  ^‘^Song  of  the  Shirt, bemoaned  the 
approach  of  the  day  when  the  steam  loom  would  deprive 
him  of  the  bare  crust  he  was  able  to  earn  when  he 
should  be  thrown  out  of  employment;  but  the  putting  of 
newer  and  cheaper  goods  on  the  market  gave  employment 
to  many  men,  and  who  were  the  men  employed  first  but 
the  men  who  were  familiar  with  those  textile  articles  and 
those  articles  in  leather.  The  cobbler  was  taken  from  the 
cellar  in  which  he  lost  his  sight  and  became  prematurely 
blind,  and  the  weaver  from  the  back  room  where  his  life 
was  miserable  beyond  our  civilization  in  this  generation  to 
conceive,  and  placed  in  a light  and  airy  factory  and  he  got 
better  wages — and  in  a short  time  he  organized  a union 
and  demanded  still  better  wages.  (Applause  and  cheers.) 

Why,  my  friends,  I heard  one  gentleman  here  declare 
that  this  method  of  combination  must  be  stopped,  be- 
cause he  said  35,000  commercial  travelers  had  been  thrown 
out  of  employment — 35,000  men  advancing  their  views 
through  one.  He  gives  no  particular  evidence  that  there 
were  35,000.  They  were  not  all  here.  Suppose  it  to  be 
true,  although  I am  always  doubtful  of  statistics,  they  come 
in  so  handy  in  the  course  of  an  argument  (applause);  sup- 
pose it  to  be  true,  suppose  that  a new  industrial  organiza- 
tion produces  results  of  great  moment  to  70,000,000  of 
].eople;  cheapens  the  cost  of  some  article  of  necessity;  and 
suppose  it  did  throw  35,000  out  of  employment,  would  you 
hold  back  the  general  welfare  of  the  community  to  suit  that 
particular  35,000?  If  we  do  it  for  35,000,  we  ought  to 
do  it  for  15,000;  if  we  do  it  for  15,000,  why  shouldiTt  we 
for  1,000?  If  we  do  it  for  1,000,  why  should  we  not  do  it 
for  one?  Why  should  we  not  hold  back  the  entire  car  of 
human  progress  until  every  human  being  can  get  aboard, 
although  in  doing  so  we  may  have  to  diminish  its  speed 


TRUSTS — PRO  AND  CON. 


123 


from  the  rate  of  the  lightning  express  to  that  of  the  lum- 
bering ox  wagon?  How  are  you  going  to  retain  this  equal- 
ity between  men?  It  would  be  better  to  pension  this  whole 
army  of  middlemen. 

And  until  there  is  a chance  to  get  at  the  pension  office 
they  will  never  materialize.  I know  of  nothing  that  pro- 
longs life  as  does  a pension.  (Great  applause.) 

Let  us  see,  my  friends,  how  this  thing  will  practically 
work.  How  are  we  going  to  keep  excellence  and  mediocrity 
upon  the  same  level?  If  you  have  competition  you  will 
have  excellence.  Is  not  every  form  of  competition  certain 
to  produce  excellence  wherever  it  occurs?  I heard  my 
friend,  a socialist,  this  morning,  whose  name,  I believe, 
ought  to  become  famous  all  over  the  United  States  after 
that  most  interesting  address  which  he  delivered,  declare 
that  competition  was  warfare.  Let  me  protest  against  that. 
Competition  is  not  warfare  in  the  sense  of  being  destruct- 
ive. Competition  is  the  ascertainment  of  the  place  of 
greatest  utility  for  each  individual.  These  men  are  not 
thrown  out  of  employment  permanently,  as  the  cobbler 
was  taken  from  his  cellar,  where  he  was  making  one  pair 
of  shoes  a day,  into  the  factory  to  make  fifty  or  sixty  pairs 
a day  with  the  increased  power  of  machinery;  so  the  man 
who  is  displaced  by  one  element  of  progress  is  not  abso- 
lutely retired  from  the  field  of  industry,  but  he  is  trans- 
ferred from  one  field,  where  he  is  no  longer  most  useful,  to 
another,  where  his  capabilities  are  of  greater  development. 

How  here  a few  days  ago  we  had  a number  of  boats  with 
which  we  had  the  honor  to  meet  to  select  a competitor  to 
defend  the  Americans  cup.  Well,  the  Columbia  won  when 
she  went  out.  Did  she  break  up  the  Defender  on  that 
account?  Was  the  Defender  ruined  on  account  of  that? 
Ho,  the  Defender  is  now  retired  simply  on  account  of  it; 
its  empty  hold  will  become  wainscoted  and  will  be  divided 
up  into  comfortable  cabins;  there  will  be  happy  faces  on 
the  deck  instead  of  sailors  pulling  and  hauling  with  des- 
perate energy,  and  will  be  assigned  a new  position  in  the 
naval  world.  It  will  join  the  great  army  of  the  Puritan 
and  the  Volunteer  and  all  the  other  defending  yachts  that 
have  now  become  relegated  to  the  past,  that  have  won  vic- 
tories in  the  past,  and  competition  has  injured  nobody. 


124 


TKUSTS — PRO  AND  CO^T. 


but  has  assigned  each  to  the  place  where  each  will  achieve 
the  greatest  glory  for  our  country  find  show  the  greatest 
speed  in  the  world  of  competition. 

COMPETITION  AND  EXCELLENCY. 

You  would  destroy  him.  When  you  defeat  him  in  com- 
petition you  may  change  his  place^  you  make  him  go 
from  the  sphere  that  he  cannot  excel  to  the  sphere  in  which 
he  can  have  a chance^  and^  believe  me^  there  is  no  human 
being  that  has  not  aptitude  in  some  department  of  human 
activity.  Any  competition^  as  I have  said,  is  absolutely 
free  to  produce  excellency.  You  have  got  the  leading  law- 
yer. He  is  a monopolist.  You  have  got  the  leading  doc- 
tor; he  monopolizes  the  best  patients,  and  the  leading 
orator  gets  the  best  audiences;  and,  in  fact,  in  that  respect 
there  is  a gentleman  here  present  now  who  is  the  great- 
est monopolist  in  that  respect  I have  ever  known.  (Laugh- 
ter and  prolonged  applause.) 

Ladies  and  gentlemen,  I am  reminded — that  recalls  an 
event  which  illustrates  this  whole  question  of  competition 
better  than  anything  I can  give — of  competition  which  is 
free  and  competition  which  is  respectable — one  supersedes 
and  dominates  the  best,  the  other  supersedes  and  dominates 
the  baser  if  not  the  basest.  Three  years  ago  a convention 
met  in  this  town,  and  while  the  delegates  were  largely 
strangers  to  each  other  a few  individuals  hoped  to  man- 
age the  convention. 

The  action  of  the  convention  threw  it  over  to  free  com- 
petition, and  a young  man  in  the  convention  as  the  result 
of  competition  sprang  upon  the  shoulders  of  the  shouting, 
excited  delegates  and  into  leadership  which  was  absolute 
in  a party.  Ladies  and  gentlemen,  would  anybody  deny 
that  the  result  of  that  free  competition  was  the  selection  of 
the  best  man  qualified?  Had  a man  been  able  to  control  the 
])roceedings  he  would  never  have  been  able  to  get  on  the 
platform. 

Now,  that  monopoly  is  made  just  as  all  other  monopo- 
lies of  intellect  and  made  by  the  same  means.  The  doc- 
tor must  protect  the  eminence  of  his  profession  by  watch- 
ing the  performances  of  science  wherever  there  is  an  op- 
portunity, that  he  might  apply  the  best  remedies;  and  the 


TKUSTS PEO  AND  CON. 


125 


orator  must  present  his  subject  to  the  audience  with  all 
the  splendor  of  his  rhetoric;  but  if  the  lawyer  maintains 
his  domination  through  the  favor  of  the  courts,  if  a phy- 
sician gets  his  patient  through  the  favor  of  some  social 
influence,  then  you  find  a competition  which  is,  instead 
of  being  the  domination  of  the  best,  the  domination  of  the 
baser,  if  not  of  the  basest. 

ENCOUEAGEMENT  OF  EXCELLENCY. 

What  are  we  to  do  if  we  are  not  to  recognize  and  en- 
courage excellency  wherever  we  find  it?  If  any  gentleman 
thinks  that  it  is  cruel  and  wrong  to  pay  $30  to  a trust  for 
a good  suit  of  clothes,  instead  of  paying  $50  for  a bad  one 
to  some  retail  dealer,  so  as  to  keep  him  going  to  preserve  a 
middleman  in  industrial  incapacity,  why,  he  has  a perfect 
right  to  do  it.  There  is  no  law  to  prevent  him,  but  he  has 
no  right  to  impose  a similar  sacrifice  upon  me,  who  donT 
share  his  scruples.  But  donT  you  see  if  it  is  wrong  to  en- 
courage excellency  in  commodities,  it  is  equally  wrong  to 
discourage  excellency  in  professions. 

Is  the  leading  orator  to  moderate  the  splendor  of  his 
periods  in  order  to  bring  his  speeches  down  to  the  level 
of  m.any  of  those  who  would  like  to  compete  with  him? 
You  see,  if  we  carry  this  thing  to  its  logical  conclusion 
it  would  leave  nothing  for  competitors  to  enjoy. 

In  my  judgment  there  is  but  one  test  of  prosperity 
which  is  absolutely  infallible — that  is,  the  rate  of  wages 
paid  to  labor. 

Demand  does  not  mean  a desire  for  an  article;  it  means 
a desire  to  extend  some  other  commodity.  My  commodity 
Avould  he  of  no  use  to  me  if  there  were  not  abundant  cloth- 
ing, if  there  were  not  abundant  houses,  if  there  were  not 
abundant  tables,  if  there  were  not  an  abundance  of  all 
commodities  to  exchange  for  it.  But  the  abundance  of 
all  these  commodities  means  a largely  increased  demand 
for  labor  to  produce  them.  A largely  increased  demand 
for  labor  means  a rise  in  the  wages  and  the  prosperity  of 
the  laborer,  with,  my  prosperity  and  prosperity  Avhich  all 
must  share.  And  that  is  what  I mean  when  I say  there 
cannot  he  abundant  production  without  there  be  exten- 
sive distribution  in  the  form  of  wages. 


126 


TKUSTS — PEO  AND  CON. 


UNIONS  DO  NOT  AFFECT  WAGES  MUCH. 

I was  greatly  impressed  to-day  by  the  statement  of  Mr. 
Gompers^  recognizing  the  fact  that  the  movement  of  in- 
dustry has  steadily  been  toward  a higher  rate  of  wages. 
It  is  very  agreeable  to  me^  ladies  and  gentlemen^  to  con- 
cur in  that  statement,  and  to  say  as  one  of  the  most  hope- 
ful signs  of  our  future  prosperity  that  the  movement  of 
wages  is  upward,  and  must  be  upward  because  there  are 
two  forces  working  in  that  direction.  But  here  I desire 
to  say  what  perhaps  may  sound  strange  to  some  of  you, 
and  may  perhaps  shock  a great  many  of  those  who  approve 
what  I have  said  before.  Here  we  come  to  the  question  of 
the  trade  unions  and  their  effect  upon  trades  industry. 
Labor  unions  do  not  affect  the  rate  of  wages  much  at  all. 
I think  perhaps  I am  the  first  person  Avho  has  advanced 
that  proposition.  And  yet  they  are  of  enormous  benefit 
to  the  whole  body  of  the  community,  quite  as  much  to  the 
employers  as  to  the  laborers,  and  it  is  to  their  protection 
and  in  their  development,  as  I hope  to  show  you  before  I 
conclude,  that  we  must  hope  for  that  industry  of  p6ace 
which  means  the  great  industrial  prosperity  to  which 
this  republic  is  destined,  I believe,  to  affect  industrial  cost 
and  conditions  in  the  whole  world. 

LAWS  OF  LABOK  AND  EXCHANGE. 

If  you  will  bear  with  me  for  a moment  and  consider 
the  law  governing  wages  you  will  find  that  the  one  thing 
which  affects  the  rate  in  laborers^  wages  is  the  volume  of 
his  product,  and  no  agreement  between  him  and  his  em- 
ployer can  enable  the  employe  to  pay  more  for  the  value 
of  his  product.  You  will  see  in  this  sense  that  it  is  im- 
possible to  maintain  for  a moment  the  idea  so  generally 
felt  that  wages  are  a species  of  alms,  that  good  employers 
pay  high  wages  and  bad  employers  pay  poor  wages. 

Eecurring  to  the  example  of  the  chair,  it  is  perfectly 
plain  that  I cannot  give  the  laborer  any  more  than  his 
share  of  that  product,  and  if  I bring  charity  into  the 
matter,  wh}^  in  a short  while  I will  be  bankrupt  and  I will 
not  be  able  to  pay  anything  at  all.  His  compensation  or 


TRUSTS — PRO  AND  CON. 


127 


his  rate  of  wages  depends  very  much^  not  on  the  em- 
ployers philanthropy,  but  upon  his  own  right  arm  and 
his  own  productive  power. 

There  are  two  laws  working  upon  wages  which  fix  its 
.standard;  one  is  competition  between  laborers  for  em- 
ployment, which  operates  to  depreciate  wages,  the  other 
IS  the  competition  between  capital  and  capital  for  profit, 
which  operates  to  raise  the  rate  of  wages.  You  will  see 
yourself  if  I am  making  chairs  and  if  I am  getting  my  labor 
for  less  than  it  is  worth  the  results  will  be  a great  increase 
in  my  profits,  but  the  moment  I show  a large  profit  in  my 
chairmaking  industry  capital  will  give  me  competition, 
and  the  resultant  condition  will  be  that  there  will  be  com- 
petition for  the  labor  of  the  laborer,  anl  the  only  way  to 
prevent  the  employer  from  bankruptcy  arising  from  a 
failure  to  obtain  labor  will  be  that  he  must  raise  wages. 

THE  EIVALKY  OF  CAPITAL. 

hTow  the  competition  between  capital  and  capital  is 
keener  than  between  laborer  and  laborer,  though  we  donT 
often  know  it.  You  will  see  that  it  takes  fourteen  days 
to  move  a laborer  from  Hongkong  to  Chicago,  but  you 
can  send  $10,000,000  from  Chicago  to  Hongkong  for  a 
postage  stamp.  Moreover,  capital  has  no  family  ties  and 
all  things  are  alike  to  it,  but  as  the  laborer  is  at  home  he 
has  domestic  associations  which  are  deeply  implanted 
in  the  fibers  of  his  being.  It  would  take  a laborer  two 
days  to  go  from  here  to  Boston,  but  you  can  send  capital 
from  here  to  London,  millions  of  it,  in  an  instant,  by  a 
cable  dispatch.  It  would  take  10  or  15  per  cent  at  least 
in  the  rate  of  wages  to  induce  a single  laborer  to  move 
from  Chicago,  where  he  had  his  home,  to  Boston,  but 
you  can  send  capital  all  around  the  world  for  an  eighth 
of  1 per  cent. 

Now  the  competition  between  capital,  then,  being 
keener  for  profit  than  the  competition  between  laborer 
and  laborer,  explains  the  rise  in  the  rate  of  interest  and 
the  fall  in  the  rate  of  wages.  There  is  no  rate  of  agree- 
ment between  employer  and  employe  by  which  the  em- 
ployer can  give  the  employe  more  than  he  is  worth;  he 
cannot  give  him  much  less  than  he  is  worth,  for  the  com- 


128 


TRUSTS — PRO  AND  CON. 


petition  of  capital  will  soon  change  that.  They  cannot 
possibly  change  the  scale  of  wages  by  any  agreement  be- 
tween themselves^  but  each  one  can  increase  his  profits — 
the  laborer  his  wages  and  the  capitalist  his  interest^ — ^by 
increasing  the  number  of  chairs,  and  therefore,  ladies  and 
gentlemen,  we  say  that  the  relation  between  the  laborer 
and  his  employer  is  a relation  of  partnership,  not  of  serv- 
ice, with  a common  interest  prospering  from  the  same 
causes,  suffering  from  the  same  calamities. 

OEIGIN  OF  STEIKES. 

Now  it  is  said  that  this  idea  of  partnership  is  incon- 
sistent with  the  strikes  and  turmoils  and  the  disturbances 
that  break  out  at  regular  intervals  between  employers  and 
laborers,  but  I think  a little  careful  attention  to  that  prob- 
lem will  satisfy  you  that  the  disputes  and  troubles  have 
not  arisen  about  the  rate  of  wages,  but  rather  in  the  meth- 
od in  which  the  discussions  have  been  maintained. 

I have  endeavored  to  follow  the  history  of  every  strike 
in  this  country.  I confess  the  great  difficulty  about  them 
is  to  locate  their  origin.  When  they  commence  the  air  is 
full  of  clubs  and  missiles.  Then  come  charges  and  re- 
criminations and  imputations  of  statements  that  the  pub- 
lic peace  has  been  violated  and  that  tyranny  has  been 
perpetrated,  but  I believe  that  a close  study  and  careful 
examination  will  satisfy  everybody  of  this  fact,  that  the 
great  strikes  of  this  country  have  arisen  from  the  refusal 
of  the  employers  to  discuss  the  question  at  issue  between 
them  and  their  employes  with  the  agents  that  the  em- 
ployes select.  (Great  applause.)  They  have  undertaken 
to  declare  various  excuses,  that  they  would  not  speak  to 
men  outside  of  their  employment  or  they  would  not 
speak  to  their  men  in  a body  or  they  would  talk  to  them 
singly,  and  that  they  would  do  one  thing  and  another, 
except  what  they  are  asked  to  do. 

Now,  concede  the  argument  that  it  may  be  foolish  for 
men  to  join  trades  unions,  to  employ  walking  delegates, 
to  organize  for  their  protection.  What  difference  can  it 
make  to  their  employers  so  long  as  they  are  free  to  fix  the 
rate  of  wages  to  the  laborer?  Nothing  could  compel  him 
to  pay  more  than  he  ought  to  pay.  Nothing  could  compel 


TKUSTS — PKO  AND  CON. 


129 


him  to  pay  more  than  the  conditions  of  his  trade  would 
allow  him  to  pay^  and  that  being  so^  what  difference  would 
it  make  whether  he  delegated  that  duty  to  one  person  or 
to  another^  so  long  as  was  free  to  fix  his  own  conclusions. 

Now^  I have  heard  very  little  about  the  strike  in  the 
course  of  these  proceedings.  It  has  surprised  me  that 
this  greatest  danger  to  civil  society  has  not  been  dis- 
cussed at  all.  I know  of  no  sign  upon  the  horizon  so 
portentous  or  so  ominous  as  the  strike.  It  is  the  form 
of  disturbance  more  deadly  than  foreign  invasion  or  civil 
war.  Against  foreign  aggression  we  can  build  fortresses 
and  behind  their  shelter  we  can  to  some  extent  pursue. the 
work  of  industrial  combination.  Even  where  the  country 
is  torn  and  rent  by  civil  disturbances  there  is  some  place 
where  men  can  work  and  toil  together.  The  disasters  of 
war  have  some  compensations^  because  others  who  are 
compelled  to  share  them  are  admitted  to  work  in  bonds 
of  mutual  interest  by  the  necessity  of  repairing  them. 

But  the  strike  attacks  us  not  from  without.  It  cor- 
rodes us  from  within^  as  the  cancer  that  corrodes  our 
vitals.  This  one  danger  springs  from  the  very  prosperity 
which  we  enjoy  and  when  we  analyze  its  causes  we  find  in 
every  instance  that  it  has  been  a case  of  bad  temper  and 
bad  manners  rather  than  an  irreconcilable  set  of  difficul- 
ties. (Immense  applause.) 

Now  I have  not  mentioned  this  merely  for  the  purpose 
of  railing  at  it,  but  for  the  purpose  again  of  suggesting  a 
remedy.  We  have  heard  it  said  that  compulsory  arbitra- 
tion is  the  correct  method  of  averting  these  strikes. 
Ladies  and  gentlemen,  compulsory  arbitration  may  pos- 
sibly become  an  accomplished  fact  in  the  years  to  come, 
but  that,  too,  is  a remote  remedy.  It  would  take  many 
long  years  before  compulsory  arbitration  could  take  such 
a definite  shape  as  to  allow  of  its  being  enforced.  We 
have  had  several  strikes  upon  these  systems,  and  I do  not 
know^  of  one  that  arose  directly  over  the  question  of  wages. 
In  every  instance  petty  disputes,  which  might  easily  have 
been  adjusted  by  a little  forbearance  on  both  sides,  were 
fanned  into  violent  fiame  by  discharging  men  who  came 
to  remonstrate,  by  the  refusal  to  talk  to  unions,  by  the 
feeling  on  the  part  of  the  employer  that  in  some  way  or 


130 


TRUSTS — PRO  AND  CON. 


other  there  would  be  a debasement  and  an  indignity  in 
treating  his  laborer  as  his  partner  rather  than  as  his 
servant.  (Applause.)  Now^  I do  not  appeal  here  for 
any  change  in  the  relationship  between  employer  apd  em- 
ploye. That  is  fixed  by  eternal  laws^  which  all  of  us 
together  could  neither  disturb  nor  modify.  (A  voice: 
^^Never;  never. 

We  have  seen  that  the  rate  of  wages  is  fixed  by  the 
volume  of  the  product,  and  nothing  can  change  it.  We 
have  seen  that  since  the  employer  and  the  employe  must 
share  prosperity  from  the  same  causes  and  adversity  from 
the  same  conditions,  their  relation  is  a partnership  and 
cannot  be  changed.  The  employer  may  discharge  his 
employe — that  is  to  say,  he  may  change  his  partners 
— ^but  when  he  takes  on  others  the  partnership  is  renewed, 
and  it  is  still  a co-operative  concern;  its  nature  cannot  be 
changed.  That  has  been  fixed  by  the  eternal  laws  of 
God  and  the  universe. 

Now,  when  a great  corporation,  charged  with  the  ex- 
ercise of  public  franchises,  suspends  the  services  which  it 
has  been  chartered  to  render,  it  is  to-day  the  duty  of  the 
attorney-general  to  ask  why  that  has  occurred.  A dis- 
tinguished judge  in  New  York  state  enjoined  an  appli- 
cation for  a mandamus  against  a railway  company  whose 
system  was  tied  up  by  a strike  among  its  freight  hand- 
lers, and  I believe  that  a right  of  action  lies  now  on 
the  part  of  any  member  of  the  public  against  a corpora- 
tion whose  service  is  suspended,  unless  it  can  show  the 
reason  for  the  suspension. 

Now  we  have  but  to  amplify  and  to  argue  that  in- 
herent principle  of  jurisprudence.  There  is  no  reason 
why  a state  should  not  provide  by  a properly  framed  law 
that  where  a public  service  is  interrupted  by  the  failure  of 
a corporation  to  discharge  the  functions  for  which  it 
holds  a franchise  the  attorney-general  should  not  bring 
an  action  to  forfeit  the  franchise  it  has  received.  And  I 
am  perfectly  willing  that  it  should  be  considered  a whole 
and  complete  defense  if  it  can  show  that  it  has  at  all  times 
been  ready  to  discuss  questions  at  issue  between  its  em- 
ployes and  itself  by  any  agency  of  their  own  selection. 


TRUSTS — PRO  AND  CON. 


131 


without  ever  going  into  the  question  as  to  whether  the 
rate  of  wages  was  too  high  or  too  low. 

I do  not  fear  a strike  if  it  can  only  have  a public  dis- 
cussion; if  the  employer  and  the  employe  are  compelled 
to  get  together  and  reason,  they  cannot  quarrel.  The 
best  way  to  defeat  an  unreasonable  demand  is  merely  to 
cause  it  to  be  formulated.  What  is  the  weapon  of  the 
striker?  It  is  public  opinion.  They  talk  about  a boycott. 
It  may  be  a good  weapon  or  it  may  be  a bad  one,  but 
certain  it  is,  it  depends  upon  public  opinion  for  its 
efficiency.  If  the  public  was  not  practically  unanimous  in 
support  of  the  boycotters,  no  boycott  could  be  enforced. 
The  way  to  suppress  a boycott,  the  w^ay  to  suppress  all 
these  labor  disturbances,  is  to  insist  upon  discussion;  and 
if  these  great  employers  of  labor,  these  great  corporations 
exercising  public  franchises,  be  compelled  to  set  an  ex- 
ample, the  results  will  be  so  beneficent  that  all  other 
employers  of  labor  will  be  eager  to  follow  their  example. 

How  can  there  be  a serious  question  between  em- 
jjloyer  and  employe  about  a question  of  wages?  If  an 
employe  demands  more  than  his  share  of  profit  of  that 
share,  against  whom  would  he  strike?  Not  against  his 
employer,  but  against  all  the  other  laborers,  his  un- 
known partners  scattered  all  over  the  world,  and  helping 
him  to  create  that  share.  If  he  gets  more  than  his  share, 
somebody  else  must  get  less.  If  the  railroad  engineer 
gets  more  than  his  share  of  the  earnings,  the  conductor, 
the  brakeman  and  the  switchman  must  get  less. 

These  principles  are  so  plain  that  if  the  condition  of 

the  industry  be  explained  to  the  employes  it  is  impossible 
for  them  to  lead  public  opinion  to  sustain  them  in  a strike 
against  their  own  interests  and  the  interests  of  the  em- 
ployer. Such  an  act  as  I suggest  would  be  a great 

measure  for  peace.  It  would  not  evade  the  law;  it  would 

simply  provide  for  its  proper  enforcement.  The  courts 
can  be  trusted  to  protect  the  interests  of  property  by  the 
enforcement  of  such  an  act,  and  no  labor  union  would 
have  any  excuse  to  appeal  to  violence,  because  all  it  is 
entitled  to  is  a fair  hearing  at  the  bar  of  public  opinion. 

Let  no  man  think  that  in  what  I say  here  I am  say- 
ing one  word  to  apologize  for  violence,  as  I insist  on  the 


132 


TRUSTS — PRO  AND  CON. 


right  of  the  laborer  to  become  a partner  of  his  employer^ 
to  be  heard  on  questions  that  affect  the  prosperity  of  their 
general  partnership.  I would  be  the  first  man  to  con- 
demn violence  and  to  advocate  any  measure  that  would 
be  necessary  to  repress  it.  Highly  as  I value  the  import- 
ance of  the  laborer,  deeply  as  I cherish  the  fact  that  the 
rate  of  his  wages  marks  the  standard  of  all  our  prosperity, 
there  is  something  more  important  than  he,  than  I:  that 
is,  the  preservation  of  public  order,  always. 

And  I will  say  here,  my  friends,  too,  that  in  my  judg- 
ment whenever  a strike  occurs  I believe  the  master  should 
always  be  held  responsible  for  public  opinion,  but  I don’t 
say  that  because  I believe  workmen  are  always  reasonable 
or  always  cheerful  or  always  obedient  or  always  indus- 
trious, but  I say  that  the  man  who  has  a strike  upon  his 
hands  confesses  thereby  that  he  is  unable  to  manage  men. 
It  may  be  because  he  is  too  good.  It  is  no  reflection  upon 
his  moral  qualities,  but  he  is  not  fit  to  manage  men,  for  he 
cannot  control  them. 

I really  believe  that  public  opinion  should  insist  that 
the  same  principle  that  governs  employers  in  hiring  a 
man  to  manage  mules  and  horses  should  govern  the  em- 
ployer who  hires  a man  to  manage  men.  Surely  if  a man 
allows  his  mule  to  come  into  violent  collision  with  a 
wagon,  when  he  got  back,  if  he  undertook  to  prove  that  it 
Avas  the  fault  of  the  mule,  that  it  v/as  out  of  pure,  abso- 
lute cussedness,  do  you  suppose  that  would  justify  it? 
Do  you  suppose  if  he  could  not  make  the  mules  go  his 
employer  would  keep  him,  however  excellent  his  moral 
character?  Is  there  any  more  sense  in  maintaining  a man 
who  is  not  able  to  manage  other  men  than  there  is  in 
hiring  a man  to  manage  mules  Avho  is  not  able  to  manage 
them? 

MAH  IN  CHARGE  RESPOHSIBLE. 

The  man  that  is  in  charge  of  a great  industry  is  the 
captain  in  the  bridge.  He  is  responsible  for  everything 
that  goes  wrong  on  the  ship,  whether  it  be  in  the  hold 
where  the  stoker  feeds  the  fire  that  gives  the  ship  en- 
ergy for  its  movements,  or  whether  it  be  aloft  in  the 
crow’s  nest,  where  the  lookout  has  been  watching  over 


TRUSTS — PRO  AND  CON. 


133 


the  safety  of  its  movement.  When  the  St.  Paul  ran 
ashore  on  the  beach  of  New  Jersey  a passenger  went  up 
to  the  captain  to  cheer  him  in  his  disaster,  and  told  him 
he  was  glad  that  he  could  find  some  consolation  in  the  fact 
that  the  general  opinion  on  board  the  ship  was  that  the 
accident  occurred  through  the  mistaken  report  of  the 
officer  throwing  the  lead,  that  honest  and  loyal  captain 
made  this  reply:  ^‘^That  is  no  excuse  for  me.  I am  the 
captain,  and  am  responsible  for  every  man,  from  the 
stoker  in  the  hold  to  the  lookout  in  the  crowds  nest. 
That  is  my  misfortune.  I ask  the  public  to  weigh  against 
this  one  fault  the  whole  record  of  a blameless  life,  but  I 
have  no  excuse  to  offer.^^ 

When  an  enterprise  goes  wrong,  when  men  who,  by  the 
law  of  their  being  should  be  co-operative  and  productive 
energies,  are  placing  their  hands  against  each  othePs 
throats  in  destructive  violence,  the  man  upon  the  bridge, 
the  captain  of  the  industry,  should  be  held  responsible  to 
public  opinion,  and  no  excuse  should  ever  be  heard  from 
the  man  who  confesses  by  the  paralysis  of  his  trade  that 
he  is  unable  to  manage  human  beings  when  those  are 
committed  to  his  management. 

THESE  KEMEDIES  PEOPOSED. 

My  friends,  these  are  my  suggestions:  Publicity  for 
corporate  mismanagement,  prohibition  under  penalties  for 
special  favors,  right  of  action  against  any  corporation 
whose  service  is  suspended,  except  an  absolute  defense 
proved  that  it  was  at  all  times  ready  to  discuss  with  its  em- 
ployes questions  at  issue  between  them  by  agencies  of  their 
selection. 

I am  told,  however,  that  if  we  promote  this  co-operation 
we  will  destroy  individualism.  Individualism  is  another 
of  those  phrases  which  have  been  specially  invented  for 
the  perplexity  of  mankind.  Individualism,  in  its  last 
analysis,  is  savagery — the  savage  depending  on  himself 
alone  for  his  shelter  and  his  food;  on  the  club  from  the 
tree,  ^r  the  stone  picked  up  by  his  unaided  hand  from, 
the  ground,  for  his  weapon,  is  the  most  complete 
instance  of  individualism  conceivable.  Civilized  man 
depends  upon  everybody  else  for  his  prosperity.  The 


134 


TEUSTS — EKO  AND  CON. 


object  of  savagery  is  to  get  a weapon  to  beat  men  away 
from  them;  the  object  of  civilization  is  the  employment 
and  protection  of  the  individual  and  the  co-operation  of 
men.  All  men  are  engaged  in  civilized  life  in  a great 
scheme  of  co-operation,  in  which  the  activity  of  every 
man^s  hand  is  of  vital  importance  to  all  the  rest. 

NO  FEAE  OF  SOCIALISM. 

We  were  told  to-day  that  this  closer  co-operation  would 
bring  around  socialism.  I have  no  fear  of  that  word.  If 
the  greater  development  of  man^s  mortality  and  genius 
brings  him  so  far  as  he  will  work  as  well  for  the  common 
good  as  he  would  for  his  own,  and  we  have  just  the  same 
impetus  for  industry  as  we  have  had,  socialism  would  not 
frighten  me,  for,  my  friends,  I believe  that  we  are  all 
bound  together  by  one  common  tie  in  common  industry, 
in  one  common  partnership.  Can  you  or  I do  one  thing 
for  the  benefit  of  himself  without  benefiting  all  his  fel- 
lows? Can  fancy  gratify  itself,  can  pride  indulge  itself? 
Can  appetite  satisfy  itself  without  paying  a tribute  to  the 
whole  human  race?  If  a man  seek  to  build  a palace 
in  order  to  give  expression  to  his  pride  and  satisfaction 
to  his  sense  of  luxury,  must  not  he  employ  10,000  hands 
in  every  quarter  of  the  globe?  The  woman  who  buys  a 
new  robe  to  gratify  her  vanity  must  give  employment  to 
hundreds  of  her  fellow-creatures  everywhere  throughout 
the  world.  Even  the  capitalists  who  from  the  most  sordid 
motives  seek  to  raise  the  rate  of  interest  from  5 per  cent 
to  6 per  cent  must  serve  his  fellows  in  doing  it. 

There  is  but  one  way  he  can  increase  the  profits  of  his 
capital,  and  that  is  to  increase  its  productivity.  If  he 
is  engaged  in  making  tables  he  must  make  more  tables, 
if  he  engaged  in  building  he  must  erect  more  houses, 
if  he  is  engaged  in  agriculture  he  must  increase  the  area 
of  tillage,  and  in  doing  that  he  must  employ  more  labor 
and  he  must  distribute  tens  of  dollars  for  every  one  that 
he  turns  into  his  own  pocket.  Our  patience,  our  vanities, 
our  hopes,  our  ambitions,  are  but  the  delusions  IVhich 
bind  us  to  the  care  of  human  progress,  making  each  one 
of  us  discharge  some  tribute  which  we  owe  to  all  hu- 
manity. (Applause.) 


TRUSTS — PRO  AND  CON. 


135 


FEEE  LABOE  CHANGES  THE  WOELD. 

If  I were  asked  to  define  the  economic  effect  of  hu- 
manity, that  which  makes  this  civilization  Christian  civi- 
lization, I should  say  it  was  the  substitution  of  free  labor 
for  slavery,  the  change  to  free  labor  from  slave  labor  has 
worked  an  extraordinary  change  throughout  this  world. 
The  removal  of  manacles  from  the  hand  of  man  has 
wonderfully  increased  its  productivity;  it  has  wonder- 
fully extended  the  scope  of  his  powers,  multiplied  his 
possessions,  lengthened  the  span  of  his  days  and  wid- 
ened the  horizon  of  his  ambitions.  But  out  of  his  very 
prosperity  it  has  created  this  difficulty  with  which  we 
are  confronted  to-day.  The  slave  was  willing  to  accept 
from  the  hand  of  his  master  a crust  of  bread  as  the  re- 
ward of  his  labor  to  escape  the  lash.  But  the  free  laborer 
enjoys  a fair  share  of  the  prosperity  which  has  been  cre- 
ated by  his  toil. 

Thank  heaven  we  have  turned  away  from  the  question 
of  foreign  wars  and  exterior  boundaries  to  internal  con- 
ditions and  domestic  prosperity.  I do  not  fear  any  ques- 
tion that  arises  from  this  prosperity.  I do  not  fear  the 
specter  of  socialism  or  an3ffhing  else  that  can  be  conjured. 
Sufficient  unto  to-day  is  this  day  in  which  we  have  al- 
ready achieved  a splendid  progress. 

Closer  co-operation  is  a step  toward  the  brotherhood  of 
man.  If  socialism  is  to  be  the  fruit  of  higher  development 
I am  not  afraid  of  the  word.  I am  not  disturbed  by  any- 
thing which  will  extend  that  principle  into  our  indus- 
trial system,  for  it  is  that  which  underlies  it;  it  is  the 
origin  of  this  industrial  system  built  upon  freedom,  en- 
larged— not  merely  the  field  of  men  in  citizenship,  but 
his  partnership  in  industry.  The  height  to  which  man 
has  risen  will  be  the  point  from  which  he  can  survey 
with  confidence  that  strength  and  that  determination  to 
still  greater  heights  that  shall  ennoble  him.  (Prolonged 
applause.) 


136 


TRUSTS — PRO  AND  CON. 


BEYAN^S  SHORT  TALK 


At  the  close  of  Cockran^s  speech  Colonel  Bryan  was 
called  to  the  front  and  spoke  briefly  as  follows: 

Mr.  Chairman,  Ladies  and  Gentlemen: — I am  denying 
myself  a great  pleasure  when  I refuse  to  respond  to  your 
very  cordial  invitation.  When  I came  this  afternoon  and 
found  that  Mr.  Cockran  and  I were  to  speak  together  this 
evening,  or  it  had  been  so  announced,  I consulted  with  him 
and  with  those  who  were  in  charge,  and  it  was  the  decision 
that  anything  like  a debate  would  not  be  in  keeping  with 
the  purpose  of  this  conference. 

We  are  not  here  to  arouse  partisan  feeling  by  standing 
as  representatives  of  different  ideas.  We  are  here  to  take 
part  in  a conference,  to  give  expression  to  our  views,  and 
to  gather  as  much  information  as  we  can  from  the  views 
expressed  by  others,  and  it  was  decided  that  it  was  better 
that  Mr.  Cockran  should  have  this  evening  by  himself  and 
that  I should  speak  to-morrow  at  10  o^clock  and  give  my 
views.  And  while^  as  I say,  I am  denying  myself  a great 
pleasure  in  refusing  to  speak  to  this  magniflcent  audience, 
I am  sure  that  you,  upon  reflection,  will  agree  that  our 
decision  is  the  correct  one,  and  that  the  purpose  of  this 
conference  shall  be  carried  out  and  that  we  shall  avoid  as 
far  as  possible  anything  that  might  seem  like  partisanship 
or  an  attempt  to  array  one  part  of  the  body  against  an- 
other part.  I donff  know  to  what  extent  Mr.  Cockran  rep- 
resents the  views  of  the  delegates  here.  I don’t  know  to 
what  extent  I represent  the  views  of  the  delegates  in  what 
I shall  say,  but  to-morrow  at  10  o’clock  I shall  submit  some 
remarks  in  regard  to  the  subject  of  monopoly  and  make 
some  suggestions  as  to  methods  by  which  monopoly  can 
be  eliminated.  I am  one  of  those  who  believe  that  monop- 
oly in  private  hands  is  undeniable  and  incontrollable  in  a 
free  country. 

While  I agree  with  much  that  Mr.  Cockran  has  said  to- 


TEXJSTS — PEO  AND  CON. 


137 


night — agree  with  some  of  the  remedies  proposed — I can- 
not fully  agree  with  all  that  he  has  said^  and  to-morrow^ 
instead  of  attempting  to  answer  any  part  in  which  I may 
differ^  I expect  to  present  this  subject  as  it  appears  to  me  in 
order  that  I may  contribute  my  part  toward  the  solution 
of  this  great  question. 


138 


TEXJSTS — PRO  AND  CON. 


FOURTH  DAY. 


At  the  opening  of  the  morning  session  of  the  fourth  and 
last  day  of  the  Conference^  Col.  William  Jennings  Bryan 
was  introduced.  Following  is  a verbatim  report  of  his 
speech: 


INDUSTBIAL  COMBINATIONB. 


WILLIAM  J.  BRYAN. 

Mr.  Chairman^  Ladies  and  Gentlemen: — I appreciate  the 
very  kind  words  of  Governor  Stanley  in  presenting  me  to 
this  audience.  I am  glad  I live  in  a country  where  people 
can  differ  from  one  another^  differ  honestly^  express  their 
convictions  boldly^  and  yet  respect  one  another  and  ac- 
knowledge one  anotheFs  rights,  I am  not  vain  enough, 
however,  to  think  that  any  good  will  which  has  been  ex- 
pressed by  the  people  toward  me  is  due  to  any  personal 
merit.  If  I have  had  political  friends  it  is  because  people 
believe  with  me  in  certain  ideas,  or  rather  that  I believe 
with  them  in  certain  ideas.  It  is  the  idea  that  makes  the 
man.  (Applause.)  The  man  is  only  important  as  he 
helps  the  idea. 

I come  this  morning  to  discuss  in  your  presence  a great 
question — a question  of  growing  importance  to  the  Amer- 
ican people.  The  trust  principle  is  not  a new  principle, 
but  the  trust  principle  is  manifesting  itself  in  so  many 
ways  and  the  trusts  have  grown  so  rapidly  that  people  now 
feel  alarmed  about  trusts  who  did  not  feel  alarmed  three 
years  ago.  The  trust  question  has  grown  in  importance, 
because  within  two  years  more  trusts  have  been  organized, 
when  we  come  to  consider  the  capitalization  and  the  magni- 
tude of  the  interests  involved,  than  were  organized  in  all 
the  previous  history  of  the  country,  and  the  people  now 
come  face  to  face  with  this  question:  Is  the  trust  a bless- 


TEUSTS — PKO  AND  CON. 


139 


A STRUCTURAL  DIFFICULTY. 


It  may  not  be  so  easy  to  correct  him  even  when  you  know  how. 

—Prom  the  Chicago  Daily  News. 


140 


TEUSTS — PEO  AND  CON. 


ing  or  a curse?  If  a curse^  what  remedy  can  be  applied  to 
NO  GOOD  MONOPOLY. 

I want  to  start  with  the  declaration  that  monopoly  in 
private  hands  is  indefensible  from  any  standpoint  and  in- 
tolerable. (Applause.)  I make  no  exceptions  to  the  rule,  I do 
not  divide  monopolies  in  private  hands  into  good  monopo- 
lies and  bad  monopolies.  (Applause.)  There  is  no  good  mo- 
nopoly in  private  hands.  There  can  be  no  good  monopoly  in 
private  hands  until  the  Almighty  sends  us  angels  to  preside 
over  us.  (Applause.)  There  may  be  a despot  who  is  bet- 
ter than  another  despot,  but  there  is  no  good  despotism. 
One  trust  may  be  less  harmful  than  another.  One  trust 
magnate  may  be  more  benevolent  than  another,  but  there 
is  no  good  monopoly  in  private  hands,  and  I do  not  be- 
lieve it  is  safe  for  society  to  permit  any  man  or  group  of 
men  to  monopolize  any  article  of  merchandise  or  any 
branch  of  business.  (Applause.) 

What  is  the  defense  made  of  the  monopoly?  The  de- 
fense of  the  monopoly  is  always  placed  on  the  ground  that  if 
you  will  allow  people  to  control  the  market  and  fix  the  price 
they  will  be  good  to  the  people  who  purchase  of  them.  The 
entire  defense  of  the  trusts  rests  upon  a money  argument. 
If  the  trust  will  sell  to  a man  an  article  for  a dollar  less 
than  the  article  will  cost  under  other  conditions,  then  in 
the  opinion  of  some  that  proves  a trust  to  be  a good  thing. 
In  the  first  place  I deny  that  under  a monopoly  the  price 
will  be  reduced.  In  the  second  place,  if  under  a monopoly 
the  price  is  reduced  the  objections  to  a monopoly  from 
other  standpoints  far  outweigh  the  financial  advantage  that 
the  trust  would  bring.  But  I protest  in  the  beginning 
against  settling  every  question  upon  the  dollar  argument. 
(Applause  and  cheers.)  I protest  against  the  attempt  to 
drag  every  question  down  to  the  low  level  of  dollars  and 
cents.  (Applause.) 

MAN  AND  THE  DOLLAE. 

In  1859  Abraham  Lincoln  wrote  a letter  to  some  people 
in  Boston,  and  in  the  course  of  the  letter  he  said:  ^^The 
Eepublican  party  believes  in  the  man  and  the  dollar,  but 


TKUSTS — PKO  AND  CON. 


141 


in  case  of  conflict  it  believes  in  the  man  before  the  dollar.*’ 
(Applause.)  In  the  early  years  of  his  administration  he 
sent  a message  to  congress^  and  in  that  message  he  warned 
his  countrymen  against  the  approach  of  monarchy.  And 
what  was  it  that  alarmed  him?  He  said  it  was  the  attempt 
to  put  capital  upon  an  equal  footing  with,  if  not  above, 
labor  in  the  structure  of  government,  and  in  that  attempt 
to  put  capital  even  upon  an  equal  footing  with  labor  in 
the  structure  of  government  he  saw  the  approach  of  mon- 
archy. Lincoln  was  right.  Whenever  you  put  capital  upon 
an  equal  footing  with  labor,  or  above  labor,  in  the  structure 
of  government  you  are  on  the  road  to  aid  a government  that 
rests  not  upon  reason  but  upon  force.  (Applause.) 

Nothing  is  more  important  than  that  we  shall  in  the  be- 
ginning rightly  understand  the  relation  between  money 
and  man.  (Great  applause.)  Man  is  the  creature  of  God 
and  money  is  the  creature  of  man.  (Applause.)  Money  is 
made  to  be  the  servant  of  man — (applause) — and  I pro- 
test against  all. theories  that  enthrone  money  and  debase 
mankind.  (Prolonged  applause.) 

CHEAPENS  EAW  MATEKIAL. 

What  is  the  purpose  of  the  trust  or  the  monopoly?  For 
when  I use  the  word  trust  I use  it  in  the  sense  that  the 
trust  means  monopoly.  And  what  is  the  purpose  of  monop- 
oly? If  you  want  to  find  out  you  can  find  out  from  the 
speeches  made  by  those  who  are  connected  with  the  trusts. 
I have  here  a speech  made  by  Charles  E.  Flint  at  Boston  on 
the  25th  day  of  last  May,  and  the  morning  papers  of  the 
26th  in  describing  the  meeting  said  he  defended  the  trust 
before  an  exceedingly  sympathetic  audience  and  then  added: 
^Tor  his  audience  was  composed  almost  exclusively  of  Bos- 
ton bankers.^^  (Applause.)  We  thus  secure,  he  says,  the 
advantages  of  larger  aggregations  of  capital  and  ability;  if 
I am  asked  what  they  are  the  answer  is  only  difficult  be- 
cause the  list  is  so  long. 

But  I now  want  to  read  to  you  a few  of  the  advantages  to 
be  derived  by  the  trusts  from  the  trust  system:  ^^Eaw  mate- 
rial bought  in  large  quantities  is  secured  at  lower  prices.^^ 
That  is  the  first  advantage.  ^^One  man  to  buy  wool  for  all 
the  woolen  manufacturers.^^  That  means  that  every  man 


142 


TRUSTS — PRO  AND  CON. 


who  sells  wool  must  sell  it  at  the  price  fixed  by  this  one 
purchaser  in  the  United  States.  The  first  thing  is  to  lower 
the  price  of  raw  material.  The  great  majority  of  the  peo- 
ple are  engaged  in  the  production  of  raw  material  and  in 
the  purchase  of  finished  products.  It  is  but  comparatively 
few  who  can  stand  at  the  head  of  syndicates  and  monop- 
olies and  secure  the  profits  from  them.  Therefore^  the  first 
advantage  of  a monopoly  is  to  lower  the  price  of  the  raw 
material  furnished  by  the  people  to  that  combination.  (Ap- 
plause.) Those  plants  which  are  best  equipped  and  most 
advantageously  situated  are  run  continuously  and  in  pref- 
erence to  those  less  favored. 

NEW  DANGER  FOR  WORKMEN. 

The  next  thing  is^  after  you  have  bought  all  the  fac- 
tories^ to  close  some  of  them  and  turn  out  of  employment 
the  men  who  are  engaged  in  them — (applause) — and  if  you 
will  go  about  over  the  country  you  will  see  where  people 
have  subscribed  money  to  establish  enterprises,  and  where 
these  enterprises,  having  come  under  the  control  of  the 
trusts,  have  been  closed  and  stand  now  as  silent  monuments 
to  the  wisdom  of  the  trust  system.  (Applause.) 

In  case  of  local  strikes  and  fires,  the  work  goes  on  else- 
where, thus  preventing  serious  loss.  Do  not  the  laboring 
men  understand  what  that  means?  In  case  of  local  strikes 
or  fires  the  v/ork  goes  on  elsewhere,  thus  preventing  serious 
loss.  What  does  it  mean?  It  means  that  if  the  people 
employed  in  one  factory  are  not  satisfied  with  the  terms 
fixed  by  the  employer  and  strike,  they  can  close  that  fac- 
tory and  let  the  employes  starve  while  they  go  on  in  other 
factories  without  loss  to  the  manufacturers. 

It  means  that  when  they  have  frozen  out  the  striking 
employes  in  one  factory  and  compelled  them  to  come  back 
to  work  at  any  price  to  secure  bread  for  their  wives  and 
children  they  can  provoke  a strike  somewhere  else  and 
freeze  them  out  there,  and  when  a branch  of  industry  is 
entirely  in  the  hands  of  one  great  monopoly,  so  that  every 
skilled  man  in  that  industry  has  to  go  to  the  one  man  for 
employment,  then  that  one  man  will  fix  wages  as  he 
pleases  and  the  laboring  men  will  share  the  suffering  of  the 
man  who  sells  the  raw  material.  (Applause.) 


TRUSTS — PRO  AND  CON. 


143 


MONOPOLY  CHEAPENS  BEAINS. 

^^There  is  no  multiplication/^  is  the  next  statement^  ^^of 
the  means  of  distribution  and  a better  force  of  salesmen 
takes  the  place  of  a large  number/^  I want  to  warn  you 
that  when  the  monopoly  has  absolute  control,  brains  will 
be  at  a discount,  and  relatives  will  be  necessary  to  fill 
these  positions.  (Applause.)  When  there  is  competition 
every  employer  has  to  get  a good  man  to  meet  competi- 
tion, but  when  there  is  no  competition  anybody  can  sit 
in  the  office  and  receive  letters  and  answer  them  when 
everybody  has  to  write  to  the  same  house  for  anything 
he  wants.  (Laughter  and  applause.)  There  is  no  ques- 
tion about  it.  A trust,  a monopoly,  can  lessen  the  cost 
of  distribution.  But  when  it  does  so  society  has  no  as- 
surance that  it  will  get  any  of  the  benefits  from  that  re- 
duction of  cost  in  reduction  of  price.  But  you  will  take 
away  the  necessity  for  that  skill,  for  that  brains.  You  will 
take  away  the  stimulus  that  has  given  to  us  the  quickness, 
the  alertness  of  the  commercial  traveler,  and  these  men, 
these  commercial  evangelists  who  go  from  one  part  of  the 
country  to  the  other  carrying  the  merits  of  their  respect- 
ive goods,  will  not  be  needed,  because  when  anybody  wants 
them  all  he  has  to  do  is  to  write  to  the  one  man  who  has 
the  things  for  sale,  and  say,  ^^What  will  you  let  me  have 
it  for  to-day (Applause.) 

^^Terms  and  conditions  of  sale  become  more  uniform, 
and  credit  can  be  more  safely  granted.^’  He  cannot  only 
fix  the  price  of  what  he  sells,  but  he  can  fix  the  terms  upon 
which  he  sells.  You  can  pay  cash,  or,  if  there  is  a discount, 
it  is  just  so  much  discount,  and  you  have  to  trust  to  that 
maffis  generosity  and  his  decision  upon  what  is  fair  wffien 
he  is  on  one  side  and  you  on  the  other.  I have  read  these 
only  as  some  of  the  advantages  which  a great  trust  mag- 
nate thinks  will  come  from  the  trust. 

LOGIC  OF  TEUST  CONTEOL, 

What  is  the  first  thing  to  be  expected  of  a trust?  That 
it  will  cut  down  expenses.  What  is  the  second?  That  it 
will  raise  prices.  We  have  not  had  in  this  country  a taste 
of  a complete  trust,  a complete  monopoly,  and  we  cannot 


144 


TRUSTS — PRO  AND  CON. 


tell  what  will  be  the  results  of  a complete  monopoly.  By 
looking  at  the  results  that  have  followed  from  an  attempt 
to  secure  a monopoly  the  monopoly  has  been  lowering 
prices  to  rid  itself  of  competitors;  but  when  it  has  rid 
itself  of  competitors^  what  is  going  to  be  the  result?  My 
friends^  all  you  have  to  know  is  human  nature.  (Applause.) 
God  made  men  selfish.  I do  not  mean  to  say  He  made  a 
mistake  when  He  did^  because  selfishness  is  merely  the  out- 
growth of  an  instinct  of  self-preservation.  It  is  the  abnor- 
mal development  of  a man^s  desire  to  protect  himself;  but 
everybody  who  knows  human  nature  knows  how  easy  it  is 
to  develop  that  side  of  a man^s  being.  Occasionally  I find 
a man  who  says  he  is  not  selfish,  but  when  I do  I find  a man 
who  can  prove  it  only  by  his  own  affidavit. 

We  get  ideas  from’  every  source.  An  idea  is  the  most 
important  thing  that  a man  can  get  into  his  head.  (Ap- 
plause.) An  idea  will  control  a man’s  life.  An  idea  will 
revolutionize  a community,  a state,  a nation,  the  world,  and 
we  never  know  when  we  are  going  to  get  an  idea.  Some- 
times we  get  them  when  we  do  not  want  to  get  them,  and 
sometimes  w^e  get  them  from  sources  which  would  not  be 
expected  to  furnish  ideas.  We  get  them  from  our  fellow 
men.  We  get  them  from  inanimate  nature.  We  get  them 
from  the  animals  about  us.  I got  an  idea  once  from  some 
hogs  that  I think  was  a valuable  idea.  I was  riding 
through  Iowa  and  I saw  some  hogs  rooting  in  a field,  and 
the  first  thought  that  came  to  me  was  that  those  hogs 
were  destroying  a great  deal  in  value,  and  then  my  mind 
ran  back  to  the  time  when  I lived  upon  a farm  and  when 
we  had  hogs. 

CHECKS  OK  THE  GEEEDY. 

Then  I thought  of  the  way  in  which  we  used  to  protect 
property  from  the  hogs  by  putting  rings  in  the  noses  of 
the  hogs;  and  then  the  question  came  to  me,  Why  did  we 
do  it?  Kot  to  keep  the  hogs  from  getting  fat,  for  we  were 
more  interested  in  their  getting  fat  than  they  were;  the 
sooner  they  got  fat  the  sooner  we  killed  them';  the  longer 
they  were  in  getting  fat,  the  longer  they  lived.  But  why 
did  we  pnt  the  ring  in  their  noses?  So  that  while  they  were 
getting  fat  they  would  not  destroy  more  than  they  were 


TRUSTS — PRO  AND  CON. 


145 


worth.  (Prolonged  applause.)  And  then  the  thought  came 
to  me  (laughter) — the  thought  came  to  me  that  one  of  the 
great  purposes  of  government  was  to  put  rings  in  the  noses 
of  hogs.  (Prolonged  applause.)  I don^t  mean  to  say  any- 
thing offensive  (applause)^  but  we  are  all  hoggish.  In 
hours  of  temptation  we  are  likely  to  trespass  upon  the 
rights  of  others. 

I believe  in  self-government.  I believe  in  the  doctrines 
that  underlie  this  government;  I believe  that  people  are 
capable  of  governing  themselves.  Why?  Because  in  their 
sober  moments  they  have  helped  to  put  rings  in  their  own 
noses  to  protect  others  from  themselves  and  themselves 
from  others  in  hours  of  temptation.  (Applause.)  And  so 
I believe  we  must  recognize  human  nature.  We  must 
recognize  selfishness  and  we  must  so  make  our  laws  that 
people  shall  not  be  permitted  to  trespass  upon  the  rights 
of  others  in  their  efforts  to  secure  advantages  for  them- 
selves. 

I believe  society  is  interested  in  the  independence  of 
every  citizen.  I wish  we  might  have  a condition  where 
every  adult  who  died  might  die  leaving  to  his  widow  and 
children  enough  property  for  the  education  of  his  children 
and  the  support  of  his  widow.  Society  is  interested  in  this 
because  if  a man  dies  and  leaves  no  provisions  for  his  wife 
and  children  the  burden  falls  upon  society.  But  while  I 
wish  to  see  every  person  secure  for  himself  a competency^ 
I don^t  want  him  to  destroy  more  than  he  is  worth  while 
he  is  doing  that.  (Applause.)  And  I believe  the  principle 
of  monopoly  finds  its  inspiration  in  the  desire  of  men  to 
secure  by  monopoly  what  they  cannot  secure  in  the  open 
field  of  competition.  (Applause.)  In  other  words,  if  I 
were  going  to  try  to  find  the  root  of  the  monopoly  evil  I 
would  do  as  I have  often  had  occasion  to  do — go  back  to 
the  Bible  for  an  explanation — and  I would  find  it  in  the 
declaration  that  the  love  of  money  is  the  root  of  all  evil. 
(Applause.) 

FIEST  CAUSE  OF  MONOPOLY. 

I will  not  ask  you  all  to  agree  with  me,  but  we  have  not 
met  here  as  a bo%  of  men  who  agreed.  We  have  met  here 
as  a body  of  men  who  are  seeking  light  and  each  ought  to 


146 


TRUSTS — PRO  AND  CON. 


be  willing  to  hear  what  every  other  has  to  say,  and  each  of 
us  should  desire  the  triumph  of  that  which  is  true  more 
than  the  triumph  of  that  which  he  thinks  may  be  true. 

Let  me  repeat  that  the  primary  cause  of  monopoly  is  the 
love  of  money  and  the  desire  to  secure  the  fruits  of  monop- 
oly; but  I believe  that  falling  prices  caused  by  a rising  dol- 
lar have  contributed  to  this  desire  and  intensified  it,  be- 
cause people  with  their  plants,  seeing  the  fall  in  prices  and 
measuring  the  loss  on  investments,  have  looked  about  for 
some  means  by  which  they  could  protect  themselves  from 
this  loss,  and  they  have  joined  in  combinations  to  hold 
up  prices  to  protect  their  investments  from  a loss  which 
would  not  have  occurred  but  for  the  rise  in  the  value  of 
dollars  and  the  fall  in  the  level  of  prices.  (Applause.) 

Another  thing  that,  in  my  judgment,  has  aided  monopoly 
is  a high  tariff.  Nobody  can  dispute  that  a tariff  law,  an 
import  duty,  enables  a trust  to  charge  for  its  product  the 
price  of  a similar  foreign  product  plus  the  tariff. 

Now,  some  have  suggested  that  to  put  everything  on  the 
free  list  that  trusts  make  would  destroy  the  trusts.  I do 
not  agree  with  this  statement  as  it  is  made  so  broadly.  I 
believe  that  the  high  tariff  has  been  the  means  of  extortion 
and  that  it  has  aided  the  trust  to  collect  more  than  the 
trust  otherwise  could  collect.  But  I do  not  believe  you  could 
destroy  all  trusts  by  putting  all  trust-made  articles  on 
the  free  list.  Why?  Because,  if  an  article  can  be  produced 
in  this  country  as  cheaply  as  it  can  be  produced  abroad  the 
trust  could  exist  without  the  benefit  of  any  tariff,  although 
it  could  not  extort  so  much  as  it  could  with  the  tariff,  and 
while  some  relief  may  come  from  modifications  of  the  tar- 
iff, we  cannot  destroy  monopoly  until  we  lay  the  ax  on 
the  root  of  the  tree  and  make  monopoly  impossible  by  law'. 
(Applause.) 

UNFAIE  EAILEOAD  EATES. 

It  has  been  suggested  that  discrimination  by  railroads 
has  aided  the  trusts.  No  question  about  it.  If  one  man 
can  secure  from  a railroad  better  rates  than  another  man, 
he  will  be  able  to  run  the  other  man  out  of  business.  And 
there  is  no  question  that  discrimination  and  favoritism  se- 
cured by  one  corporation  against  another  producer  and  a 


TKUSTS PRO  AND  CON. 


147 


rival  have  been  largely  instrumental  in  enabling  a de- 
sired monopoly  to  become  practically  a complete  monop- 
oly. Now  that  can  be  remedied  by  laws  that  will  prevent 
this  discrimination^  and  when  we  prevent  the  discrimina- 
tion^ when  we  place  every  producer  upon  the  same  footing 
and  absolutely  prevent  favoritism^  monopoly  may  still  ex- 
ist. The  remedy  must  go  farther.  It  must  be  complete 
enough  to  prevent  the  organization  of  a monopoly. 

Now  w^hat  can  be  done  to  prevent  the  organization  of  a 
monopoly?  I rather  think  we  differ  more  in  remedy  than 
we  do  in  our  opinion  of  the  trust.  (Applause.)  I venture 
to  guess  that  few  people  will  defend  the  trust  as  a prin- 
ciple^ or  a trust  organization  as  a good  thing,  but  I imag- 
ine our  great  difference  will  be  as  to  remedy,  and  I want, 
for  a moment,  to  discuss  the  remedy. 

We  have  a dual  form  of  government.  We  have  a state 
government  and  a federal  government,  and  while  this  dual 
form  of  government  has  its  advantages,  and  to  my  mind 
advantages  which  can  hardly  be  overestimated,  yet  it  also 
has  its  disadvantages.  When  you  prosecute  a trust  in  the 
United  States  court  it  hides  behind  staters  sovereignty,  and 
w'hen  you  prosecute  it  in  the  state  court  it  rushes  to  cover 
under  federal  jurisdiction — (applause) — and  we  have  had 
some  difficulty  in  prosecuting  a remedy. 

STATE  AND  NATIONAL  KEMEDIES. 

I believe  we  ought  to  have  remedies  in  both  state  and 
nation,  and  that  they  should  be  concurrent  remedies.  In 
the  first  place,  every  state  has,  or  should  have,  the  right 
to  create  any  private  corporation  which  in  the  justice  of 
the  people  of  the  state  is  conducive  to  the  welfare  of  the 
people  of  that  state.  I believe  we  can  safely  intrust  to  the 
people  of  a state  the  settlement  of  a question  which  con- 
cerns them.  If  they  create  a corporation  and  it  becomes 
destructive  of  their  best  interests  they  can  destroy  that  cor- 
poration, and  we  can  safely  trust  them  both  to  create  and 
to  annihilate  if  conditions  make  annihilations  necessary. 
In  the  second  place,  the  state  has,  or  should  have,  the  right 
to  prohibit  any  foreign  corporation  from  doing  business  in 
the  state,  and  it  ought  to  have  or  has  the  right  to  impose 
such  restrictions  and  limitations  as  the  people  of  the  state 


148 


TRUSTS — PRO  AND  CON. 


may  think  necessary  for  foreign  corporations  doing  business 
in  the  state.  In  other  words^  the  people  of  the  state  not 
only  should  have  a right  to  create  the  corporations  they 
want^  but  they  should  be  permitted  to  protect  themselves 
against  any  outside  corporation. 

But  I do  not  think  this  is  sufficient.  1 believe  in  addi- 
tion to  a state  remedy  there  must  be  a federal  remedy^ 
and  I believe  congress  has,  or  should  have,  the  power  to 
place  restrictions  and  limitations,  even  to  the  point  of  pro- 
hibition, upon  any  corporation  organized  in  one  state  that 
wants  to  do  business  outside  of  the  state.  I say  that 
congress  has,  or  should  have,  power  to  place  upon  that  cor- 
poration such  limitations  and  restrictions,  even  to  the 
point  of  prohibition,  as  may  to  congress  seem  necessary  for 
the  protection  of  the  public  good. 

HE  PEOPOSES  EESTKICTIONS. 

Now  I believe  that  tliese  concurrent  remedies  will  reach 
the  difficulty^  that  the  people  of  every  state  shall  first  de- 
cide whether  they  want  to  create  a corporation;  that  they 
shall,  secondly,  decide  whether  they  want  any  outside  cor- 
poration to  do  business  in  the  state,  and,  if  so,  upon  wliat 
conditions;  and  thirdly,  that  congress  shall  exercise  the 
right  to  place  upon  every  corporation  doing  business  out- 
side of  the  state  in  which  it  is  organized  such  limitations 
and  restrictions  as  may  be  necessary  for  the  protection  of 
the  public  good. 

I do  not  believe  the  people  of  one  state  can  rely  upon 
the  people  of  another  state  in  the  management  of  a cor- 
})oration.  And  I might  give  you  a reason.  I have  here  a 
letter  that  was  sent  out  by  a trust  company  of  Delaware. 
It  has  an  office  in  New  York;  and  it  is  a most  remarkable 
document,  and  the  most  remarkable  document  on  this  sub- 
ject that  has  ever  fallen  under  my  observation.  We  have 
talked  about  the  state  of  Delaware  having  a law  favorable 
to  trusts.  I have  a letter  here  which  shows  that  in  Dela- 
ware they  adopted  a law  for  the  purpose  of  making  Dela- 
ware more  favorable  to  the  trusts  than  New  Jersey.  Let 
me  read  the  letter.  This  is  a little  long,  but  it  will  repay 
reading: 

^‘^The  state  of  Delaware  has  just  adopted  the  most  favor- 


TKUSTS — PRO  AND  CON. 


149 


able  of  existing  general  corporation  laws — one  marking  a 
forward  step  in  the  evolution  of  corporations.  It  does  not 
encourage  reckless  incorporation^  nor  merely  the  exist- 
ence of  wild-cat  companies,  but  it  furnishes  at  the  least 
expense  ample  rights  to  stockholders  and  reduces  restric- 
tions upon  corporate  action  to  the  minimum. 

LAWS  DEAWN  FOE  CAPITAL. 

^^The  enactment  is  not  the  result,  as  in  the  case  of  most 
states,  of  hesitating,  halting,  enacting,  amending  and  re- 
pealing^ but  is  a logical  and  systematic  measure  framed  by 
a committee  of  able  lawyers  appointed  by  the  legislature 
to  examine  the  various  statutes  of  the  various  states  and 
prepare  a bill  which  should  embody  the  good  and  eliminate 
the  bad  points  of  existing  law.  The  law  is  based  broadly 
upon  that  of  the  state  of  New  Jersey  and  embraces  all  the 
beneficial  provisions  and  safeguards  found  in  the  laws  of 
that  state.  It  is,  however,  in  many  respects,  advanced  far 
beyond  New  Jersey,  and  makes  Delaware  a much  more  at- 
tractive home  for  business  corporations. 

^Tn  the  following  salient  provisions  the  Delaware  and 
New  Jersey  laws  are  substantially  identical:  1.  Any  three 
persons  may  organize  a corporation.  2.  It  may  engage  in 
any  lawful  business  excepting  banking.  3.  Its  existence 
may  be  perpetual  or  limited.  4.  It  may  purchase  and  deal 
in  real  or  personal  property  wherever  situated,  and  to  any 
desired  amount.  5.  It  may  be  a mortgagee  or  a mortgagor. 
6.  It  may  conduct  business  anywhere  in  the  world.  7. 
Stock  may  be  issued  for  property  purchased,  and  in  Dela- 
ware for  services  rendered,  and  in  the  absence  of  fraud  the 
judgment  of  the  directors  as  to  the  value  of  such  property 
or  services  is  conclusive.  8.  It  may  easily  wind  up  its  affairs 
and  dissolve  itself.  9.  Its  authorized  capital  stock  need 
not  be  more  than  $2,000,  and  only  $1,000  of  this  need  be 
subscribed  for.  10.  The  amount  of  capital  stock  which  it 
may  issue  is  unlimited.  11.  It  may  file  its  certificate  of 
incorporation  and  even  begin  business  before  any  sum 
whatever  is  paid  in.  12.  It  may  have  different  classes  of 
stocks,  with  different  privileges  or  restrictions.  13.  The 
charter  may  be  easily  amended.  14.  Only  one  director 
need  be  a resident  of  Delaware.  15.  Capital  stock  may  be 


150 


TRUSTS — PRO  AND  CON. 


easily  diminished  or  increased.  16.  The  corporation  may 
be  readily  merged  or  consolidated  into  other  corporations. 
17.  The  incorporators  may  or  may  not  limit  the  authority 
of  the  directors  as  to  the  liabilities.’^ 

DELAWAEE’S  BID  FOE  TEADE. 

And  after  giving  us  these  points  of  similarity  the  letter 
proceeds  as  follows:  ^^The  Delaware  law  possesses  the  fol- 
lowing advantages:  1.  The  original  fee  that  we  pay  for 
incorporation  is  small — about  three-quarters  of  that  in  New 
Jersey.  2.  The  annual  tax  is  small — one-half  of  that  in 
New  Jersey.  Delaware  is  a small  state  and  does  not  need 
very  large  revenue.  (Laughter.)  3.  Stockholders  and  di- 
rectors may  hold  their  meetings  wherever  they  please  and 
need  never  meet  in  the  state  of  Delaware.  New  Jersey 
stockholders  must  meet  in  that  state.  You  see,  it  is  a de- 
cided advantage  over  the  New  Jersey  law  in  that  respect. 

4.  The  original  stock  and  transfer  books,  which  in  a New 
Jersey  corporation  may  be  kept  in  the  state,  may  be  kept 
in  or  out  of  Delaware,  in  the  discretion  of  the  company. 

5.  The  examination  of  the  books  by  intermeddlers  is  much 
more  difficult  under  the  Delaware  law  than  under  the  laws 
of  any  other  state.  (Applause.)  6.  The  liability  of  the 
stockholders  is  absolutely  limited  when  the  stock  has  once 
been  issued  for  cash,  property  or  services.  7.  Stock  may 
be  issued  in  compensation  for  services  rendered,  and  in  the 
absence  of  fraud  in  the  transaction  the  judgment  of  the 
directors  as  to  the  value  of  such  services  is  conclusive.  8. 
For  certain  improved  classes  of  corporations,  as,  for  in- 
stance, railroads,  railway,  telegraph,  cable,  electric  light, 
steam-heating  power,  gas-piping  lines  and  sleeping  car 
companies,  the  advantage  is  still  more  marked.” 

I wish  we  had  some  way  of  knowing  what  the  additional 
advantages  are,  after  having  read  the  ordinary  advantages. 
(Laughter.)  ^^9.  The  annual  report  of  a Delaware  corpora- 
tion is  required  to  give  no  secret  or  confidential  informa- 
tion. 10.  The  certificate  need  not  show  nor  need  public 
record  be  in  any  way  made  of  the  amount  of  stock  sub- 
scribed by  any  incorporator.” 

And  then  the  letter  adds:  ^^This  company  is  authorized 
to  act  as  the  agent  and  trustee  of  corporations  organized. 


TRUSTS — PRO  AND  CON. 


151 


under  the  Delaware  law.  It  will  maintain  the  principal  office 
of  the  company  in  Delaware  and  keep  an  agent  in  charge 
within  the  state.  It  is  formed  for  the  purpose  of  facilitat- 
ing the  incorporation  of  companies  in  Delaware  and  of 
aiding  them  to  comply,  at  a minimum  expense,  with  the 
requirements  of  the  Delaware  law.  We  are  ready  to  aid 
and  give  full  information  to  incorporators  or  their  counsel. 
We  do  not  interfere,  between  attorney  and  client.  We  do 
not  conduct  a law  business.  Copies  of  the  Delaware  law 
and  blank  forms  of  information  concerning  Delaware  cor- 
porations furnished  on  application.^^ 

GALLEEY  PUTS  A QUEEY. 

A voice  from  the  gallery — Colonel,  Delaware  and  New 
Jeisey  are  both  Democratic  states,  are  they  not?  Mr. 
Bryan — They  were  not  in  1896.  (Cheers  and  applause.) 
Another  voice  from  the  gallery — Has  the  gentleman  any 
more  questions  to  put?  Mr.  Bryan — I am  very  glad  to 
have  questions  asked,  because  we  are  seeking  the  truth. 
(Laughter  and  applause.) 

Mr.  Bryan  continued: 

I have  read  this  letter  to  show  you  that  where  a state 
can  gain  an  advantage  from  the  incorporation  of  these 
great  aggregations  of  wealth  it  is  not  safe  to  place  the  peo- 
ple of  other  states  at  the  tender  mercies  of  the  people  of 
such  a state  as  may  desire  to  secure  its  running  expenses 
from  the  taxation  of  corporations  organized  to  prey  upon 
people  outside.  So  I read  the  letter  to  show  how  impossi- 
ble it  is  for  us  in  one  state  to  depend  for  protection  upon 
the  people  in  another  state;  and  while,  as  I say,  I believe 
the  people  of  every  state  should  have  the  power  to  create 
corporations  and  restrain  and  limit  or  annihilate,  yet  I 
believe  no  complete  remedy  can  be  found  for  the  trust 
until  the  federal  judgment,  with  a power  sufficiently  com- 
prehensive to  reach  into  every  nook  and  corner  of  the  coun- 
try, shall  lay  its  hands  upon  these  trusts  and  declare  that 
they  shall  no  longer  exist.  (Applause.) 

Now',  I am  here  to  hear  and  to  receive  and  to  adopt  any 
method  that  anybody  can  propose  that  looks  to  the  anni- 
hilation of  the  trusts.  One  method  has  occurred  to  me, 
and  to  me  it  seems  a complete  method.  It  may  not  com- 


152 


TRUSTS — PRO  AND  CON. 


mend  itself  to  you.  If  you  have  something  better  I shall 
accept  it  in  the  place  of  this  which  I am  about  to  suggest. 
But  the  method  that  occurs  to  me  is  this:  That  congress 
should  pass  a law  providing  that  no  corporation  organized  in 
any  state  should  do  business  outside  of  the  state  in  which  it 
is  organized  until  it  receives  from  some  power  created  by 
congress  a license  authorizing  it  to  do  business  outside  of 
its  own  state.  (Applause.)  Now^  if  the  corporation  must 
come  to  this  body  created  by  congress  to  secure  permission 
to  do  business  outside  the  state^,  then  that  license  can  be 
granted  upon  conditions  which  will^  in  the  first  place^  pre- 
vent the  watering  of  stock;  in  the  second  place  will  pre- 
vent monopoly  in  any  branch  of  business;  and  third,  pro- 
vide for  publicity  as  to  all  of  the  transactions  and  business 
of  the  corporation.  (Applause.) 

DUTY  OF  COYGEESS. 

A voice ^Uolonel,  would  such  a law  be  constitutional?^^ 

I was  going  to  cover  that.  I am  glad  you  mentioned  it. 
What  I mean  to  say  is  this,  that  congress  ought  now  to 
pass  such  a law.  If  it  is  unconstitutional  and  so  declared 
by  the  Supreme  Court,  I am  in  favor  of  an  amendment  to 
the  Constitution  that  will  give  to  congress  power  to  destroy 
every  trust  in  the  country.  (Applause.)  The  first  condi- 
tion which  I suggested  was  that  no  water  should  be  al- 
lowed in  the  stock.  I doiTt  agree  with  those  who  say  it  is 
a matter  entirely  immaterial  whether  a corporation  has 
water  in  its  stock  or  not.  It  is  true  that  in  the  long  run, 
if  you  are  able  to  run  as  long  as  the  run  is,  you  may 
squeeze  the  water  out  of  the  stock,  but  during  all  that  time 
the  harm  goes  on;  during  all  that  time  the  trust  demands 
the  right  to  collect  dividends  upon  capital  represented  by 
no  money  whatever.  I do  not  believe  any  state  should  per- 
mit the  organizution  of  any  corporation  with  a single  drop 
of  water  in  the  stock  of  that  corporation.  (Applause.)  The 
farmer  cannot  inflate  the  value  of  his  land  by  watering  the 
value  of  that  land.  The  merchant  in  the  store  cannot  in- 
flate the  value  of  the  goods  upon  his  shelves.  Why  should 
the  corporation  be  permitted  to  put  out  stock  that  repre- 
sents no  real  value? 

Why,  there  are  instances  where  there  are  $4  of  water 


TRUSTS — PRO  AND  CON. 


153 


for  $1  of  money.  Yes,  a man  suggests  seven.  Do 
I hear  a higher  bid?  (Applause.)  I have  known  it  to  be 
twelve  (laughter) — but  I am  a conservative  man,  and  I 
must  maintain  my  reputation.  (Applause.)  No  man  can 
defend  stock  that  does  not  represent  money  invested,  and 
only  in  the  case  of  a monopoly  can  you  secure  dividends 
upon  stock  that  does  not  represent  money  invested. 

PUBLIC  PAYS  FOE  WATEE. 

'We  had  a case  in  Nebraska  in  which  w^e  tried  to  regu- 
late railroad  rates,  and  one  railroad  in  our  state  was  cap- 
italized and  bonded  for  more  than  five  times  what  it 
would  cost  to  duplicate  the  road,  and  yet  the  judge  held 
that  in  fixing  rates  and  in  determining  what  was  fair  com- 
pensation for  the  railroad  we  had  to  consider  the  watered 
stock  as  well  as  the  actual  value  of  that  road,  and  when  the 
case  v/ent  to  the  Supreme  Court  the  Supreme  Court  ren- 
dered a decision,  which,  while  I cannot  quote  it  in  its 
(xact  language,  was,  in  substance,  this:  That  in  determin- 
ing what  was  a reasonable  rate  we  had  to  take  into  con- 
sideration a number  of  things  beside  the  present  value  of 
that  road,  measured  by  the  cost  of  reproduction. 

And  you  will  find  that  if  the  watering  of  the  stock  is 
permitted  the  cry  of  the  innocent  purchaser  is  raised,  and 
you  will  be  told  that  you  must  protect  the  man  who  bought 
this  stock.  My  judgment  is  that  no  man  can  stand  in  the 
position  of  an  innocent  purchaser  who  buys  stock  in  a cor- 
poration if  that  stock  is  not  rep^’esented  by  actual  money 
invested,  because  he  can  find  out  what  the  stock  stands  for 
if  he  will  only  investigate.  And  if  the  man  can  learn  upon 
investigation,  why  protect  him  in  his  ignorance  Avhen  that 
ignorance  is  due  to  his  unwillingness  to  investigate?  Now, 
if  this  license  is  granted,  then  the  first  conditions  can  be 
that  any  corporation  desiring  to  do  business  outside  of  the 
state  in  which  it  is  organized  shall  bring  to  that  board  or 
body  proof  that  that  stock  is  bona  fide  and  that  there  is  no 
water  in  it.  In  my  judgment,  when  you  take  from  monop- 
oly the  power  to  issue  stock  not  represented  by  money  you 
will  go  more  than  half  the  way  toward  destroying  monopoly 
in  the  United  States.  (Applause.) 


154 


TRUSTS — PRO  AND  CON. 


DANGEE  IN  SECEECY. 

You  can  provide  for  publicity^  and  that  annually  or  at 
such  other  times  as  the  corporation  shall  make  returns  of 
its  business  and  of  its  earnings,  because,  as  has  been  well 
said  by  men  who  have  spoken  here,  corporations  cannot 
claim  that  they  have  a right  or  that  it  is  necessary  to  cover 
their  transactions  with  secrecy,  and  when  you  provide  for 
publicity,  so  that  the  public  shall  know  just  what  there  is  in 
the  corporation,  just  what  it  is  doing  and  just  what  it  is 
making,  you  will  go  another  long  step  toward  the  destruc- 
tion of  the  principle  of  monopoly.  (Applause.) 

But  I am  not  willing  to  stop  there.  I do  not  want  to 
go  one  step  or  two  steps.  I want  to  go  all  the  way  and 
make  the  principle  of  monopoly  absolutely  impossible,  or  a 
monopoly  absolutely  impossible  in  the  industry  of  this 
country.  (Applause.)  And  therefore,  as  a third  condition, 
I suggest  that  this  license  shall  not  be  granted  until  the 
corporation  shows  that  it  has  not  had  a monopoly  and  is 
not  attempting  a monopoly  of  any  branch  of  industry  or 
any  article  of  merchandise.  (Applause.)  Then  provide 
that  if  the  law  is  violated  the  license  can  be  revoked.  I do 
not  believe  in  the  government  giving  privileges  to  be  used 
by  a corporation  without  reserving  the  right  to  withdraw- 
them  when  those  privileges  become  hurtful  to  the  peo- 
ple. (Applause.) 

I may  be  mistaken,  but  as  I have  studied  the  subject  it 
has  seemed  to  me  that  this  method  of  dealing  with  the 
trusts  would  prove  an  effective  method;  but  if  you  once  es- 
tablish the  system  and  require  the  license,  then  congress 
can  from  year  to  year  add  such  new  conditions  as  may 
be  necessary  for  the  protection  of  the  public  from  the  greed 
and  avarice  of  great  aggregations  of  wealth. 

EIGHTS  OF  COEPOEATIONS. 

I do  not  go  as  far  as  some  do  and  say  there  shall  be  no 
private  corporations,  but  I say  this,  that  a corporation  is 
created  by  law,  it  is  created  for  the  public  good,  and  it 
should  never  be  permitted  to  do  a thing  that  is  injurious  to 
the  public  good — (applause) — and  that  if  any  corporation 
enjoys  any  privileges  to-day  which  are  hurtful  to  the  public. 


TRUSTS — PRO  AKD  CON. 


155 


those  privileges  ought  to  be  withdrawn  from  it.  In  other 
words,  I am  willing  that  we  should  first  see  whether  we 
can  preserve  the  benefits  of  the  corporation  and  take  from 
it  its  possibilities  for  harm.  A delegate — Would  you  apply 
that  to  rich  individuals,  also?  Say  Rockefeller  did  it  on 
his  account.  Mr.  Bryan — We  have  not  reached  a point  yet 
where  an  individual  has  been  able  to  do  harm,  and  in  my 
judgment  if  we  would  abolish  those  laws  that  grant  spe- 
cial privileges  and  pick  out  men  to  be  favorites  of  the  gov- 
ernment, no  man  by  his  own  brain  and  muscle  could  ever 
earn  enough  money  to  be  harmful  to  the  people.  A voice — 
'Now  will  you  be  good?  A delegate — Please,  what  will  you 
say  to  the  banks  reporting  five  hundred  millions  of  money 
in  the  land  and  four  billions  of  loans?  Mr.  Bryan — Well, 
I would  say  it  would  not  be  safe  to  have  all  the  loans  col- 
lected at  once. 

Following  out  the  suggestion  the  gentleman  has  made, 
I want  to  add  to  what  I have  said  to  this  extent:  My  con- 
tention has  been  that  we  have  been  placing  the  dollar  above 
the  man;  that  we  have  been  picking  out  favorites  in  gov- 
ernment, and  have  been  bestowing  upon  them  special  priv- 
ileges, and  every  advantage  we  have  given  them  has  been 
given  them  to  the  detriment  of  other  people.  My  conten- 
tion is  that  there  is  a vicious  principle  running  through  the 
various  policies  which  we  have  been  pursuing:  that  in  our 
taxation  we  have  been  imposing  upon  the  great  struggling 
masses  the  burdens  of  government,  while  we  have  been 
voting  the  privileges  to  the  people  who  will  not  pay  their 
share  of  the  expenses  of  the  government.  (Applause.) 

UNJUST  LAW  IS  LARCENY. 

Every  unjust  tax  law  is  an  indirect  form  of  larceny.  If, 
for  instance,  a man  who  ought  to  pay  $10  only  pays  $5,  and 
one  who  ought  to  pay  $5  pays  $10,  the  law  that  compels 
this  contribution  from  these  two  men  virtually  takes  $5 
from  one  man^s  pocket  and  puts  that  $5  in  another  man^s 
pocket,  and  I have  claimed  that  when  we  collected  our 
taxes  we  were  making  the  poor  people  pay  not  only  their 
own  share,  but  the  share  of  men  whom  they  have  no  chance 
to  meet  at  the  summer  resorts.  (Applause.)  And  I have 
been  gratified  to  note  the  progress  you  have  been  making 


156 


TRUSTS — PRO  AND  CONT. 


in  Illinois — (applause) — toward  a more  equitable  division 
and  a more  equitable  distribution  of  the  burdens  of  gov- 
ernment. 

I heard  it  stated  that  there  was  a time  only  a few  years 
ago  when  the  agriculiural  implements  owned  by  the 
farmers  living  within  the  city  limits  of  Chicago  were  as- 
sessed for  more  money  than  was  assessed  against  all  the 
other  people  who  lived  within  the  limits  of  the  city  of  Chi- 
cago. I donh  know  whether  it  was  true  or  not^  but  I saw 
it  stated  as  a fact.  There  are  some  people  who  have  visible 
property,  others  who  have  invisible  property,  and  the  visi- 
ble property  is  always  taxed.  The  invisible  property  has 
too  often  escaped,  and  as  the  result  the  people  owning 
visible  property  have  paid  not  only  their  own  taxes  but  the 
taxes  that  should  have  been  paid  by  the  owners  of  invisible 
property,  and  I have  advocated  an  income  tax  because  I 
have  believed  it  to  be  the  most  just  tax.  I don’t  mention 
it  to  argue  the  subject  here,  because  I want  to  avoid  the 
discussion  of  questions  that  might  be  in  the  nature  of 
partisan  or  political  capital.  But  I only  mention  it  in  fol- 
lowing out  the  suggestion  I made  in  reply  to  a question 
that  if  this  government  will  go  out  of  the  business  of  pick- 
ing out  favorites  and  follow  the  doctrine  of  equal  rights  to 
all  and  special  privileges  to  no  man — (applause) — if  it  will 
do  that  I have  no  fear  that  any  man  by  his  own  brain  and 
his  own  muscle  will  be  able  to  secure  a fortune  so  great  as 
to  be  a menace  to  the  welfare  of  his  fellow  men. 

VAST  ACCUMULATIONS  OF  WEALTH. 

If  we  can  secure  a government  whose  foundations  are 
laid  in  justice  and  laws  exemplifying  the  doctrine  of  equal- 
ity before  the  law — if  we  can  secure  such  a government  and 
such  laws,  and  then  under  such  a goverument  aud  such 
laws  wealth  is  accumulated  to  a point  where  it  becomes 
dangerous.  Ave  can  meet  that  question  when  it  arises,  and 
I am  willing  to  trust  the  wisdom  of  society  to  meet  every 
question  that  arises  and  remedy  every  wrong.  (Sigmund 
Zeisler — What  will  yon  do.  Colonel,  with  the  multi-million- 
aires who  already  exist?  Suppose  they  should  hold  and 
acquire  all  the  industries,  all  the  factories,  and  particularly 
industries?  Colonel  Bryan — Do  you  mean  before  our  laws 


TRUSTS — PRO  AND  CON. 


157 


got  into  operation?  Mr.  Zeisler — The  multi-millionaires 
who  already  exist.) 

Firsts  I would  see  if  they  die  soon  enough  to  relieve  us  of 
danger^  and  if  they  didnT  I would  see  what  was  necessary 
to  protect  society  from  them.  And  this  brings  me  to  what 
I regard  a very  important  branch  of  this  subject.  I am 
glad  the  suggestion  w^as  made  about  the  difference  between 
an  individual  and  a corporation.  Every  trust  rests  upon  a 
corporation.  At  least  that  rule  is  so  nearly  universal  that 
I think  we  can  accept  it  as  the  basis  for  our  deliberation. 
Every  trust  rests  upon  a corporation  and  every  corporation 
is  a creature  of  law.  The  corporation  is  a man^  individuals. 

WHEN  GOD  MADE  MAN. 

When  God  made  man  as  the  climax  of  creation^  He 
looked  upon  His  work  and  said  it  was  good^  and  yet  when 
God  got  through  the  tallest  man  was  not  much  taller  than 
the  shortest^  and  the  strongest  man  was  not  much  stronger 
than  the  weaker.  That  was  God^s  plan.  We  looked  upon 
His  work  and  said  it  was  not  quite  as  good  as  it  might  be, 
and  so  we  made  a fictitious  man  that  is  in  some  instances  a 
hundred  times — a thousand  times — a million  tiriies — 
stronger  than  God  made  man.  (Applause.)  Then  we  start- 
ed this  man-made  giant  out  among  the  God-made  pygmies. 
Now  when  God  made  man  he  placed  a limit  to  his  existence, 
so  that  if  he  were  a bad  man  he  could  not  do  harm  long,  but 
when  we  made  our  man-made  man  we  raised  the  limit  on 
his  age.  (Laughter  and  applause.)  When  God  made  man 
He  breathed  into  him  a soul  and  warned  him  that  in  the 
next  world  he  would  be  held  accountable  for  the  deeds 
done  in  the  flesh,  but  when  we  made  our  man-made  man  we 
did  not  give  him  a soul^  and  if  he  can  avoid  punishment 
in  this  world  he  need  not  worry  about  the  hereafter.  (Ap- 
plause. A voice — That  is  pretty  good.) 

My  contention  is  that  the  law  that  created  must  retain 
control,  and  that  the  man-made  man  must  be  admonished 
every  day  of  his  life:  ^^Eemember  now  thy  Creator  in  the 
days  of  thy  youth.^’  (Prolonged  applause.)  Let  me  call 
your  attention  again  to  this  distinction.  We  are  not  dealing 
Avith  the  natural  man;  we  are  not  dealing  with  natural 
rights.  We  are  dealing  with  the  man-made  man  and  arti- 


158 


TRUSTS — PRO  AND  CON. 


ficial  privileges  and  so-called  rights.  What  government 
gives  the  government  can  take  away.  What  the  government 
creates  it  can  control^  and  I insist  that  both  the  state  gov- 
ernment and  the  federal  government  must  protect  the  God- 
made  man  from  the  man-made  man.  (Applause.) 

NOT  A NATUKAL  OUTGKOWTH. 

I have  faith  that  these  questions  will  be  settled^  and 
settled  rights  but  I want  to  protest  against  this  doctrine 
that  the  trust  is  a natural  outgrowth  of  natural  laws.  It 
is  not  true.  The  trust  is  the  natural  outgrowth  of  unnat- 
ural conditions  created  by  man-made  laws.  (Applause.) 
There  are  some  who  would  defend  everything,  good  or 
bad,  on  the  ground  that  it  is  a part  of  destiny  (applause) 
and  you  cannot  inquire  into  it.  The  fact  that  it  is,  proves 
that  it  is  right;  the  fact  that  it  is,  proves  that  it  has  come 
to  stay,  and  the  most  potent  argument  that  was  ever  made 
in  defense  of  a vicious  system  was  not  that  it  was  right,  and 
ought  to  stay,  but  that  it  has  come  to  stay,  whether  you  like 
it  or  not.  I say  that  is  the  most  potent  argument  that  has 
ever  been  advanced  in  behalf  of  an  error — it  is  here,  it  has 
come  to  stay,  what  are  you  going  to  do  about  it? 

I believe  that  in  a civilized  society  the  question  is  not 
what  is,  but  what  ought  to  be  (applause),  and  that  every 
proposition  must  be  arraigned  at  the  bar  of  reason.  If  you 
can  prove  that  a thing  is  good,  let  it  stay,  but  if  you  can- 
not prove  that  it  is  good  you  cannot  hide  behind  the  doc- 
trine that  it  is  here  and  you  cannot  get  rid  of  it.  I believe 
i;he  American  people  can  get  rid  of  anything  they  don’t 
want  (great  applause)  and  that  they  ought  to  get  rid  of 
everything  that  is  not  good.  (Applause.)  I believe  the 
duty  of  every  citizen  is  to  give  to  his  countrymen  the  re- 
sults of  his  conscience  and  his  judgment  and  cast  his  influ- 
ence, be  it  small  or  great,  upon  the  right  side  of  every 
question  that  arises,  and  that  in  the  determination  of  ques- 
tions we  should  find  out  what  will  make  our  people  great 
and  good  and  strong,  more  than  what  will  make  them  rich. 

MENACE  OF  AN  AEISTOCEACY. 

Shall  I decide  the  ethics  of  larceny  by  discussing  how 
much  the  man  is  going  to  steal,  or  the  chances  of  getting 


TRUSTS PRO  AND  CON. 


159 


caught?  No,  my  friends,  you  have  to  decide  upon  a high- 
er ground,  and  if  you  were  to  prove  to  me  that  a monopoly 
would  reduce  the  price  of  the  articles  we  have  to  purchase 
1 would  still  be  opposed  to  it  for  this  reason,  which  to  my 
mind  overshadows  all  pecuniary  arguments:  Put  the  in- 
dustrial system  of  this  nation  into  the  hands  of  a few  men 
and  let  them  determine  the  price  of  all  material,  let  them 
determine  the  price  of  finished  products  and  the  wages  of 
labor  paid,  and  you  will  have  an  industrial  aristocracy  be- 
side which  a landed  aristocracy  would  be  an  innocent  thing, 
in  my  judgment.  (Great  applause.) 

I may  be  in  error,  but  in  my  judgment  a government  of 
the  people,  by  the  people  and  for  the  people  will  be  im- 
possible when  a few  men  control  all  the  sources  of  produc- 
tion and  hand  out  daily  bread  to  all  the  rest  on  such  terms 
as  the  few  may  prescribe.  I believe  this  opinion  is  the 
hope  of  the  world.  I believe  the  Declaration  of  Independ- 
ence was  the  grandest  document  ever  penned  by  human 
hands.  (Applause.)  The  truths  of  that  declaration  are 
condensed  into  four  great  propositions:  That  all  men  are 
created  equal,  that  they  are  endowed  with  inalienable 
rights,  that  governments  are  instituted  among  men  to  pre- 
serve those  rights  and  that  governments  derive  their  just 
powers  from  the  consent  of  the  governed.  (Cheers  and 
applause.)  Such  a government  is  impossible  under  an  in- 
dustrial aristocracy. 

EULE  OF  THE  SYNDICATES. 

Place  the  food  and  clothing  and  all  that  we  eat  and 
wear  and  use  into  the  hands  of  a few  people  and  instead  of 
being  a government  by  the  people  it  will  be  a government 
of  the  syndicates,  by  the  syndicates  and  for  the  syndicates. 
(Applause.)  Establish  such  a government  and  the  people 
will  soon  be  powerless  to  secure  a legislative  remedy  for 
any  abuse.  Establish  such  a system  and  the  night  before 
election  a man  will  be  notified  not  to  come  back  the  day 
after  election  unless  the  policy  of  the  trusts^  candidate  is 
successful.  (Continued  cheers  and  applause.)  Establish 
such  a government  and  instead  of  giving  the  right  of  suf- 
frage to  the  people  you  virtually  give  the  right  of  suffrage 
to  the  heads  of  monopolies^  with  each  man  empowered  to 


160 


TRUSTS — PRO  AND  CON. 


vote  as  many  times  as  he  has  employes.  I am  not  willing  to 
place  the  laboring  men  of  this  country  absolutely  at  the 
mercy  of  the  heads  of  monopolies — (cheers) — I am  not 
willing  to  place  the  men  who  produce  the  raw  material  ab- 
solutely into  the  hands  of  the  monopolies^  because^  when 
you  control  the  price  that  a man  is  to  receive  for  what  he 
produced  you  control  the  price  that  he  is  to  receive  for  the 
labor  in  the  production  of  that  thing. 

The  farmer  has  no  wages^  except  as  the  wages  are  meas- 
ured by  the  price  of  his  product^,  and  when  you  place  it  in 
the  power  of  the  trust  to  fix  the  price  of  what  the  farmer 
sells^  you  place  it  in  the  power  of  the  trust  to  lower  the 
v/ages  the  farmer  receives  for  his  work^  and  when  you  place 
it  in  the  power  of  the  trust  to  raise  the  price  of  what  he 
buys^  you  do  the  farmer  a double  injury,  because  he  burns 
the  candle  at  both  ends  and  suffers  when  he  sells  and  again 
when  he  buys  of  the  trust.  (Great  applause.) 

KINSHIP  OF  ALL  TOILEES. 

Some  people  have  tried  to  separate  the  laboring  man 
who  works  in  the  factory  from  the  laboring  man  who  works 
on  the  farm.  I want  to  warn  the  laboring  men  in  the  fac- 
tories that  they  cannot  separate  themselves  from  those  who 
toil  on  the  farm  without  inviting  their  own  destruction.  I 
warn  the  laboring  men  in  the  factories  that  when  they  join 
with  the  monopolies  to  crush  the  farmer,  as  soon  as  the 
farmer  is  crushed  the  laboring  man  will  be  crushed,  and 
his  ally  will  be  destroyed — (applause) — and  in  a test  of 
endurance  the  farmer  will  stand  it  longer  than  the  laboring 
man.  I come  from  an  agricultural  state — one  of  the  great 
agricultural  states  of  this  nation — and  I want  to  say  to 
you  that  while  our  people  are,  I believe,  a unit  against  the 
trusts  we  can  stand  the  trusts  longer  than  the  laboring 
men;  we  can  stand  all  the  vicious  policies  of  government 
longer  than  the  laboring  man  can. 

The  farmer  was  the  first  man  on  the  scene  when  civiliza- 
tion began  and  he  will  be  the  last  to  disappear.  (Applause.) 
The  farmer  wants  to  own.  his  home;  he  ought  to  own  it. 
I think  this  nation  is  safer  the  larger  the  proportion  of 
home  owners.  (Applause.)  I want  every  man  with  a fam- 
ily to  own  his  home.  The  farmer  wants  to  own  his  home, 


TRUSTS — PRO  AND  CON. 


161 


but  if  you  won^t  let  him  he  can  rent.  He  will  have  to  be 
employed  to  work  the  farm^  because  the  fellow^s  who  would 
take  the  farm  wouldnh  work  it  if  they  had  it.  Take  from 
him  by  mortgage^  if  you  like,  but  the  man  who  foreclosed 
the  mortgage  and  buys  in  the  property  will  not  work  the 
farm.  He  will  need  the  farmers  to  work  for  him,  but  he 
will  have  to  give  the  farmer  enough  to  live  on,  or  the 
farmer  cannot  work.  You  may  drive  the  farmer  down  so 
he  cannot  buy  coal,  but  he  can  burn  corn.  (Laughter.) 
But  you  drive  the  coal  miner  down  so  he  cannot  buy  corn, 
and  he  cannot  eat  coal.  You  can  drive  the  farmer  down 
so  he  cannot  buy  factory-made  goods,  but  his  wife  can  do 
like  the  wife  of  old — make  the  clothing  for  the  family  off 
of  the  farm.  But  when  you  close  your  factories  it  will  take 
all  the  accumulated  wealth  of  the  cities  to  feed  your  starv- 
ing men,  made  starving  by  your  vicious,  greedy,  avaricious 
legislature.  (Applause.) 

PLEA  POE  UYSELFISHHESS. 

But,  my  friends,  why  should  we  try  to  see  who  could 
hold  out  the  longest  in  suffering?  Why  try  to  see  who  can 
endure  the  most  hardships  and  yet  live?  Why  not  try  to 
see  who  can  contribute  most  to  the  greatness  and  to  the 
glory  and  to  the  prosperity  of  this  nation?  Why,  those 
who  can  contribute  most  should  make  this  government 
what  the  fathers  intended  it  to  be.  For  one  hundred  years 
this  nation  has  been  the  light  of  the  world.  For  one  hun- 
dred years  the  best  of  all  nations  have  looked  to  this  nation 
for  hope  and  instruction.  Let  us  settle  these  great  ques- 
tions that  we  have;  let  us  teach  the  world  the  blessing  of  a 
government  that  comes  from  the  people,  and  let  us  show 
them  how  happy  and  how  prosperous  people  can  be. 

I believe  the  doctrine  that  God  made  all  men  of  the 
same  dust  and  did  not  make  some  to  crawl  on  hands  and 
knees  and  others  to  ride  upon  their  backs.  We  recognize 
that  man  has  his  rights  and  can  defend  them;  and  he  must 
also  respect  the  rights  of  others.  Let  us  show  what  can 
be  done  when  we  put  into  actual  practice  those  great  doc- 
trines of  human  equality  and  of  equal  rights  and  make  this 
government  what  the  fathers  intended,  so  that  we  shall 


163 


TBUSTS — PRO  AND  CON. 


lead  the  world  step  by  step  onto  higher  ground.  I thank 
you  for  your  attention. 


MONOPOLIES  UNDER  PATENT. 


JAMES  H.  RAYMOND. 

After  Colonel  Bryan  closed,  Janies  H.  Eayrnond  of  Chi- 
cago was  presented  then.  He  spoke  on  ^^Monopolies  Under 
Patents  and  the  Industrial  Effects  Thereof. The  encour- 
agement of  our  patent  system,  he  maintained,  has  been  a 
factor  in  increasing  our  export  trade,  and  it  has  dignified 
and  enriched  daily  toil.  He  laid  down  this  proposition: 

The  encouragement  and  the  hope  of  regard,  by  way  of 
a monopoly  for  the  limited  period  or  of  a full  and  speedy 
compensation  for  parting  with  the  monopoly  in  whole  or 
in  part,  which  the  patent  laws  of  the  United  States,  in  no 
equivocal  terms,  promises  to  its  people,  have  filled  Ameri- 
can workmen  with  ambition.  I must  add  that  any  ma- 
terial interferences  in  the  carrying  out  of  these  promises, 
whether  by  congress,  by  the  courts  or  by  the  communes, 
will  degrade  labor,  will  widen  the  breach  between  capital 
and  labor,  will  tend  to  destroy  our  mechanical  and  indus- 
trial supremacy,  will  tend  largely,  whatever  the  conditions 
of  peace  or  war  may  be,  to  reverse  the  balance  of  trade  be- 
tween our  nation  and  other  nations,  and  will  work  havoc 
in  all  our  boasted  institutions. 


PRACTICAL  REMEDIES  FOR  TRUSTS. 


G.  W.  NORTHRUP. 

G.  W.  Horthrup  followed  Mr.  Eayrnond,  taking  as  his 
theme  ^Tractical  Eemedies  for  Industrial  Trusts.^^  He 
concluded  with  the  proposition: 

It  is  idle  for  a state  to  punish  and  extirpate  its  own  do- 
mestic monopolies,  so  long  as  its  manufacturers,  dealers 
and  consumers  remain  practically  subject  to  the  destruct- 
ive competition  of  foreign  monopoly. 


TKUSTS — PRO  AND  CON. 


163 


CIVIC  FEDERATION  ON  TRUSTS, 


PROP.  DAVID  KINLEY. 

David  Kinley,  professor  of  the  University  of  Illinois, 
presented  a report  on  the  information  gathered  by  the 
Civic  Federation  concerning  trusts.  The  report  was  in 
part  as  follows: 

Questions  were  sent  to  wholesale  dealers,  commercial 
travelers,  railroads,  combinations,  labor  organizations,  con- 
tractors and  manufacturers,  economists,  financiers,  public 
men,  etc. 

According  to  these  replies  the  following  articles  cannot 
be  bought  outside  of  trusts:  Anthracite  coal,  bagging, 
grass  goods,  cigarettes,  copper  (rolled),  coffee,  glass,  iron 
and  steel  (certain  iron  and  steel  products  such  as  chains, 
nails  and  shovels,  pipe,  etc.),  glucose,  kerosene  oil,  liquors 
(domestic  distilled,  except  some  Kentucky  whisky), 
matches  (certain  makes),  raisins,  roofing  (felt  and  slate), 
powder  and  ammunition,  stoves,  sardines,  starch,  snuff, 
solder,  scythe  snaths,  tin  plate,  tinware,  tobacco  (certain 
brands  as  Battle- Ax,  Horse  Shoe,  Duke^s  Mixture  and  Dur- 
ham), white  lead,  white  pine  lumber,  woodenware  and  yeast 
cakes. 

In  answer  to  the  question  what  effect  combinations  have 
on  the  distributor,  110  say  it  is  injurious  because  it  de- 
creases their  business  and  profits  and  tends  to  eliminate 
them,  and  forty-nine  wholesale  dealers  think  they  have 
been  benefited  by  the  formation  of  combinations. 

In  answer  to  the  question  what  effect  combinations  have 
on  the  consumer,  105  think  consumers  are  injured,  while 
only  twenty-four  think  they  are  benefited,  and  forty-one 
think  there  is  no  difference. 

The  items  of  information  about  prices  aggregate  506. 
Four  hundred  and  fifty-two  were  to  the  effect  that  prices 
rose  after  combinations  were  made,  twenty-four  that  they 
fell,  fifteen  that  there  was  no  change,  and  fifteen  that  they 
were  fluctuating,  210  do  not  specifically  assign  a cause, 
189  assign  trusts  as  the  cause  of  the  change  (increase  in 
most  of  these  cases),  and  forty  assign  other  causes,  usually 
^fincreased  demand,^^  ^^rise  of  raw  materials,’^  or  the  tariff. 


164 


TKUSTS PRO  AND  CON. 


Of  the  452  answers  that  prices  rose^  294  were  from  whole- 
sale dealers^  105  from  manufacturers  and  contractors^  and 
fifty-three  from  commercial  travelers. 


TBU8T8  FROM  A BU8INF88  MAM^8 
8TANDP0INT. 


T.  B.  WALKER. 

The  last  speaker  for  the  morning  session  was  T.  B. 
Walker,  who  spoke  on  ‘^^Trusts  from  a Business  Man^s 
Standpoint. Among  other  things  he  said: 

I have  watched  the  methods  of  the  trusts  for  several 
years,  and  the  more  I have  become  familiar  with  them  and 
known  their  methods  the  more  I have  beconie  satisfied  that 
they  are  an  element  of  evil  in  society.  For  instance,  let  us 
take  up  the  tin  plate  trust.  Where  there  was  altogether 
about  $10,000,000  worth  of  property,  it  was  capitalized  for 
$50,000,000;  $20,000,000  preferred  was  given  to  the  plant 
owners,  $20,000,000  of  common  stock  was  also  issued,  and 
$10,000,000  went  to  the  promoters  for  compensation.  The 
tin  plate  industry  to-day  is  earning  15  to  20  per  cent  on 
$50,000,000  of  stock,  having  only  $10,000,000  worth  of 
legitimate  property,  and  the  price  of  tin  has  almost 
doubled.  The  basis  on  which  a trust  is  organized  prevents 
them  from  furnishing  goods  as  cheap  to  the  community 
as  they  could  be  furnished  under  the  old  methods,  because 
you  have  got  from  five  to  ten  times  as  much  stock  to  pay 
a dividend  on. 


One  o^clock  having  arrived,  the  chairman  declared  the 
conference  adjourned  until  3 p.  m.  During  the  interval 
the  resolutions  committee  made  its  final  decision  and  was 
prepared  for  the  report  by  the  time  the  morning  session 
adjourned. 


TRUSTS — PRO  AND  CON. 


165 


THE  LAST  SESSION. 

The  session  opened  at  3 o’clock^  and  Chairman  Howe 
first  announced  the  committee  he  had  been  ordered  to  ap- 
point in  the  morning  on  finance  and  publication.  Follow- 
ing is  the  membership:  A.  H.  Bartlett  of  Illinois,  E.  D. 
Sutherland  of  Nebraska,  Thomas  Osborn  of  New  York,  W. 
I).  Foulke  of  Indiana,  T.  D.  Walker  of  Minnesota;  Frank- 
lin Head  and  Ealph  M.  Easley,  ex-officio  members. 

Eecalling  the  slow  response  on  the  part  of  delegates  to 
the  opportunity  for  a general  discussion  on  one  previous 
occasion,  the  chairman  decided  to  open  the  way  by  asking 
two  speakers  to  break  the  ice. 


ON  TEXAS  LAW. 


HON.  T.  S.  SMITH. 

Attorney  General  T.  S.  Smith  of  Texas  was  the  first. 
He  dwelt  upon  the  meaning  and  workings  of  the  anti-trust 
law  in  his  state  with  reference  to  the  general  subject  of 
trusts  and  trust  legislation.  State  legislation  together 
with  national  legislation  he  deemed  necessary  to  remedy 
the  evil  of  trusts  and  protect  the  people.  Continuing^  he 
said: 

So  far  as  the  Texas  anti-trust  law  is  concerned,  we  do 
not  expect  to  confiscate  anybody's  property.  We  say  to 
you:  ^‘^You  may  come  to  Texas  and  transact  any  business, 
Imt  it  must  be  a legal  business  and  open  to  competition, 
and  that  restriction  is  based  alike  upon  individuals,  part- 
nership and  corporations.^^ 


NEW  JERSEY  TRUSTS. 


J.  B.  DILL. 

James  B.  Dill,  a corporation  lawyer  of  New  York,  but 
doing  a large  business  in  New  Jersey,  followed  with  the 
declaration  that  he  was  going  to  talk  horse  sense  for  about 


166 


TRUSTS — PRO  AND  CON. 


five  minutes.  ^^New  Jersey  is  as  much  misunderstood/^  he 
said^  Texas  as  Texas  is  misunderstood  in  New  Jersey. 
In  part  he  said: 

If,  instead  of  providing  for  the  punishment  of  trusts 
after  being  organized,  you  will  provide  for  the  punishment 
of  the  man  that  promotes  them,  you  will  kill  the  eggs  in 
the  nest  before  they  are  hatched.  I would  simply  provide 
for  the  English  statute  in  this  country — that  any  article 
advertising  the  stock  of  a corporation  or  any  prospectus 
issued  in  regard  to  the  stock  of  a corporation,  wherein  a 
sum  of  m.oney  is  mentioned  as  the  subscribed  capital,  shall 
truly  state  the  amount  of  money  actually  paid  and  sub- 
scribed as  capital  of  the  corporation.  The  effect  of  these 
meetings  here,  whatever  resolutions  are  passed  to-day,  I 
believe,  will  check. these  dishonest  combinations,  because 
it  will  show  that  men  are  still  living  who  go  about  ready 
to  prick  the  bubbles  of  sham  and  fraud,  wherever  they  are 
found. 


GENERAL  DISCUSSION 


FOTJLKE  CHALLENGES  BRYAN 

From  this  on  the  conference  was  thrown  open  in  debate 
to  all  comers,  although  Mr.  Howe  called  first  upon  William 
Dudley  Foulke  of  Indiana,  asking  if  he  did  not  have  some- 
thing to  say.  Mr.  Foulke  was  on  his  feet  in  a moment 
taking  issue  with  some  of  Mr.  Bryants  proposed  remedies. 
In  part  he  argued: 

An  amendment  to  the  constitution  requires  to  be  car- 
ried by  a two-thirds  vote  by  three-fourths  of  the  states. 
If  we  are  to  have  federal  legislation  to  control  the  products 
of  the  great  part  of  our  manufacturing  industries,  practi- 
cally nearly  all  the  agencies  by  which  we  live  and  move  and 
have  our  being;  if  we  are  to  have  federal  courts  adjudicat- 
ing upon  all  classes  in  regard  to  those  things,  it  will  be  very 
evident  that  state  lines  will  be  shadowy  things  in  the  pres- 
ence of  the  great  industrial  force  of  the  consolidated  re- 
public. My  friends,  are  you  ready  for  that  change?  If 
you  are  to  dissolve  the  Standard  Oil  Company,  Mr.  Eocke- 


TRUSTS PRO  AND  CON. 


167 


feller  and  his  associates  could  easily  organize  a partnership 
with  sufficient  capital  to  carry  on  exactly  that  same  busi- 
ness in  exactly  that  same  way. 

It  was  this  speech  of  Mr.  Foulke  which  directly  brought 
on  the  debate  between  Mr.  Bryan  and  Mr.  Cockran.  Mr. 
Bryan  was  sitting  with  the  Nebraska  delegation  in  the  rear 
of  the  hall.  He  took  the  floor  amid  cries  of  ^^Bryaffi^  and 
^^Speech.^^ 


CHICAGOAN  DEFIES  COCKRAN 

But  a Chicagoan  named  Copeland  had  beaten  him  to  the 
chairman’s  ear  and  Mr.  Bryan  gave  way  to  the  man  in  front 
for  the  time.  Looking  Mr.  Cockran  at  his  side  squarely  in 
the  face  a large  share  of  the  time,  Mr.  Copeland  argued 
for  many  things  and  defled  Mr.  Cockran  to  a debate. 
He  particularly  urged  the  efficacy  of  the  initiative  and  ref- 
erendum. He  said  in  part: 

You  will  never  get  any  legislation  inimical  to  the  trusts 
in  your  own  interests  until  you  get  the  power  of  legislation 
into  your  own  hands;  until  you  get  your  courts  dowm  from 
the  high  benches  down  among  your  own  selves;  until  you 
get  these  executive  officers  to  be  your  servants  and  not 
your  masters. 


BRTAN  REPLIES  TO  FOULKE. 

Mr.  Bryan,  replying  to  Mr.  Foulke,  said: 

Mr.  Chairman,  I would  not  occupy  the  time  again,  but 
for  the  fact  that  the  gentleman  from  Indiana  (Mr.  Foulke) 
has  referred  to  a plan  which  I suggested,  and  I am  afraid 
that  he  does  not  fully  understand.  Just  a word  in  regard 
to  the  plan.  I want  to  repeat  that  it  was  not  presented  as 
the  only  plan,  nor  is  it  necessarily  the  best  plan.  It  is 
simply  a plan.  I was  sorry  that  when  the  gentleman  got 
through  destroying  this  plan  he  did  not  suggest  a better 
one.  (Applause.)  Political  agnosticism  is  of  no  great 
benefit  to  the  public.  Not  to  know  what  to  do  is  often  a 
convenient  position  to  occupy,  but  it  contributes  very  little 
to  the  settlement  of  a question.  (Applause.) 

My  plan  was  this: 


168 


TRUSTS — PRO  AKD  CON. 


1.  T^hat  the  state  should  have  the  right  to  create  what- 
ever private  corporations  the  people  of  the  state  think  best. 

2.  That  the  state  has^  or  should  have,  the  right  to  impose 
such  limitations  upon  an  outside  corporation  as  the  people 
of  the  state  may  think  necessary  for  their  own  protection. 
That  protects  the  rights  of  the  people  of  the  state  to  say, 
first,  what  they  shall  organize  in  their  state  as  a corpora- 
tion, and  second,  what  they  shall  permit  as  a corporation 
to  come  from  other  states  to  do  business  in  their  state. 

FEDEEAL  EESTEICTIONS. 

3.  That  the  federal  government  has  or  should  have  the 
right  to  impose  such  restrictions  as  congress  may  think 
necessary  upon  any  corporation  which  does  business  out- 
side of  the  state  in  which  it  is  organized.  In  other  words, 
I would  preserve  to  the  people  of  the  state  all  the  rights 
that  they  now  have,  and  at  the  same  time  have  congress 
exercise  a concurrent  remedy  to  supplement  the  state  rem- 
edy. When  the  federal  government  licenses  a corpora- 
tion to  do  business  outside  of  the  state  in  which  it  is  or- 
ganized, it  merely  permits  it  to  do  business  in  any  state, 
under  the  conditions  imposed  by  that  state,  in  addition  to 
the  conditions  imposed  by  the  federal  government.  I 
would  not  take  away  from  the  state,  the  people  of  the 
state,  any  right  now  existing,  but  I would  have  the  federal 
government  and  the  state  government  exercise  the  powers 
that  may  be  necessary  to  annihilate  the  monopoly.  I do 
not  agree  with  the  gentleman  that  you  cannot  annihilate  a 
monopoly.  (Applause.)  I believe  it  is  possible  to  do  so, 
and  I could  not  help  but  think  of  a line  of  a song  while 
the  gentleman  was  speaking,  and  while  he  was  destroying 
every  possible  remedy  suggested  yet  nresented  no  other. 
I thought  of  that  rhyme: 

^Tlunged  in  a gulf  of  deep  despair, 

Ye  wretched  sinners  lie.^^ 

(Great  laughter  and  applause.) 

You  are  here.  There  is  no  help  for  you!  Now,  it  is  a 
great  deal  easier  to  find  fault  with  a remedy  proposed 
than  to  propose  a remedy  which  is  faultless,  and  Macau- 
lay— I think  he  is  the  author  of  the  phrase — has  said: 


TRUSTS — PRO  AND  CON. 


169 


any  money  was  to  be  made  by  disputing  the  law  of 
gravitation,  able  men  could  be  found  to  write  articles 
against  the  truth  of  that  law.^^  And  I have  no  doubt  that 
any  remedy  that  is  proposed  will  be  assaulted. 

AS  TO  ITS  CONSTITUTIONALITY. 

Now,  this  is  a conference.  We  have  not  met  here  to 
destroy  the  trusts.  Every  law  for  the  annihilation  of 
trusts  must  go  through  political  action.  We  are  here  to 
discuss  these  questions.  We  are  here  to  contribute  what 
light  we  can  and  receive  what  light  others  can  contribute. 
W e are  here  to  find  out  the  various  remedies  that  are  pro- 
posed. Now,  I am  not  sure  that  the  remedy  which  I pro- 
pose is  unconstitutional.  I am  not  sure  that  the  constitu- 
tion would  prohibit  such  an  act  of  congress  as  I suggest. 
Suppose  congress  should  say  that  whenever  a corporation 
wanted  to  do  business  outside  of  the  state  it  must  apply 
to  and  receive  from  somebody  created  by  congress  for  the 
purpose  a license  to  do  business.  Suppose  the  law  should 
provide  three  conditions  upon  which  the  license  should  be 
issued. 

1.  That  the  evidence  shall  show  that  there  is  no  water  in 
the  stock. 

2.  That  the  evidence  should  show  that  this  corporation 
has  not  in  the  past  and  is  not  attempting  now  to  monopo- 
lize any  branch  of  industry  or  a branch  of  any  article  of 
merchandise;  and 

3.  Providing  for  that  publicity  which  everybody  has 
spoken  of  and  about  which  everybody  agrees.  Suppose 
that  is  done.  Who  is  here  to  say  that  such  a law  would 
be  unconstitutional? 

COULD  AMEND  THE  CONSTITUTION. 

But  suppose  the  law  is  passed  and  is  held  unconstitu- 
tional, then  we  can  amend  the  constitution.  The  gentle- 
man suggests  that  it  is  a difficult  thing  to  get  two-thirds 
of  both  houses  to  favor  amendment  and  three-fourths  of 
the  states.  That  is  true,  it  is  a difficult  thing,  but  if  the 
people  want  to  destroy  the  trusts  you  can  get  two-thirds 
of  both  houses  and  three-fourths  of  the  states.  But  what 
is  the  alternative?  Sit  down  and  do  nothing?  Allow 


170 


TRUSTS — PRO  AND  CON. 


them  to  trample  upon  you  and  ride  roughshod  over  you, 
and  then  thank  God  that  you  still  have  some  life  left?  Is 
that  the  only  remedy? 

I heard  of  a man  once  who  had  been  taught  to  be  con- 
tented with  his  lot,  and  finally  became  veiy  poor  and 
traded  oft  his  coat  for  a loaf  of  bread.  Before  he  had  a 
chance  to  eat  the  bread  a dog  came  along  and  snatched  it 
away  from  him.  He  felt  a little  indignant  at  first,  but 
finally  that  feeling  of  contentment  came  back  to  him,  and 
as  he  watched  the  dog  turn  around  a corner  in  the  road 
carrying  the  bread  away  he  said:  ^‘^Well,  thank  God,  I 
still  have  my  appetite  left.^^  (Laughter  and  applause.) 
Kow,  there  are  some  people  who  seem  to  preach  that 
doctrine  that  we  ought  to  be  satisfied  with  anything. 

AMEEICANS  ENTITLED  TO  BEST. 

My  friends,  the  American  people  are  entitled  to  the  best 
that  there  is.  (Applause.)  The  American  people  are  en- 
titled to  the  best  system  on  every  subject.  I believe  when 
these  questions  are  presented  to  the  American  people  they 
will  select  and  secure  the  best  system. 

I do  not  believe  it  necessary  for  us  to  sit  down  quietly 
and  permit  a great  aggregation  of  wealth  to  strangle  every 
competitor.  I do  not  believe  that  it  is  in  accordance  with 
our  dignity  as  a people,  or  in  accordance  with  the  rights 
of  the  people  to  say,  because  a great  corporation  is  or- 
ganized that  therefore  it  should  be  permitted  to  go  into 
the  field  of  a new  corporation,  undersell  it  until  it  bank- 
rupts it,  raising  the  money  by  higher  prices  somewhere 
else. 

I donT  think  it  is  necessary  for  us  to  do  that.  I have 
only  suggested  a plan.  It  may  not  be  the  best  plan.  If 
you  have  anything  better  propose  it.  If  there  is  any 
ameuclment  that  you  can  think  of  that  will  improve  it, 
suggest  it.  I am  anxious  to  accept  anything. 

Let  me  suggest  one  other  thing  that  I believe  will  be  a 
step  in  the  right  direction.  The  great  trouble  has  been 
that,  while  our  platforms  denounce  corporations,  corpo- 
rations control  the  elections  and  place  under  obligation  to 
them  the  men  who  are  elected  to  enforce  the  law.  (Ap- 
plause.) 


TRUSTS — PRO  AND  CON. 


171 


WHICH? 


—From  the  Chicago  Tribune. 


17-3 


TKUSTS — PRO  AND  CON. 


Let  me  propose  a remedy — not  a remedy,  but  a step, 
1 think,  in  the  right  direction.  Let  the  laws,  state  and 
national,  make  it  a penal  offense  for  any  corporation  to 
contribute  to  the  campaign  fund  of  any  political  party. 
(Continued  cheers  and  applause.)  Nebraska  has  such  a 
law,  passed  two  years  ago.  Tennessee  has  such  a law, 
passed  two  years  ago.  Such  a law  was  passed,  or  was 
introduced  in  the  state  of  New  York,  but  so  far  it  has 
not  reached  the  stage  of  actual  law  in  the  state  of  New 
York.  (Laughter.)  Now,  I believe  it  is  a step  in  the 
right  direction. 

SUGAK  TEUST  TESTIMONY. 

You  remember  the  testimony  taken  before  a senate  com- 
mittee a few  years  ago,  when  the  head  of  the  sugar  trust 
testified  that  the  sugar  trust  made  it  its  business  to  con- 
tribute to  campaign  funds;  and  when  asked  to  which  one 
it  contributed,  replied  that  it  depended  upon  circumstan- 
ces. ^^To  which  fund  do  you  contribute  in  Massachu- 
setts,^^ was  asked.  ^^To  the  Eepublican  fund.^^  ^^To  which 
fund  in  New  York?^^  ^^To  the  Democratic  fund.^^  "^To 
which  fund  in  New  Jersey  and  the  man  says,  ^AVell,  I 
will  have  to  look  at  the  books;  that  is  a doubtful  state.^^ 
(Continued  laughter  and  applause.)  Now,  that  is  almost 
a literal  reproduction  of  the  testimony  of  one  great 
corporation  on  the  subject  of  campaign  contribution.  I 
donT  mean  to  say  that  that  remedy  will  be  a complete  one, 
but  I believe  that  when  you  prevent  a corporation  from 
contributing  to  campaign  funds  that  you  take  a step  in  the 
right  direction  toward  better  legislation,  because  some 
corporations  are  compelled  to  contribute;  they  are  black- 
mailed into  contributions,  and  such  a law  would  protect  a 
corporation  that  did  not  want  to  contribute  and  also  pre- 
vent a corporation  from  contributing  that  did  want  to 
contribute.  If  the  people  are  in  earnest  they  can  do  it, 
and  you  never  could  do  anything  in  this  country  until  the 
people  are  in  earnest,  and  when  the  American  people  un- 
derstand what  the  monopoly  question  means,  I believe  that 
there  will  be  no  power,  political,  financial  or  otherwise, 
to  prevent  the  people  from  taking  possession  of  every 
branch  of  the  government,  from  President  to  the  Supreme 


TRUSTS — PRO  AND  CON. 


173 


Court,  and  making  the  government  responsible  to  the 
people^s  will.  (Cheers  and  applause.) 


COCKRAN  REPLIES  TO  BRYAN. 

Scarcely  had  Mr.  Bryan  left  the  stage  than  the  chair- 
man recognized  Mr.  Cockran,  who  was  seated  in  the  ISTew 
York  section,  close  to  the  platform.  Beginning  with  Mr. 
Bryan  as  an  introduction,  he  spoke  as  follows: 

Mr.  Chairman,  Ladies  and  Gentlemen: — Just  one  mo- 
ment while  I express  my  complete  concurrence  in  much 
that  Mr.  Bryan  has  said  and  my  great  satisfaction  that 
he  has  taken  the  platform  for  the  purpose  of  restoring 
this  debate  to  its  natural  limits.  If  there  be  a monopoly 
that  oppresses,  I believe  that  there  is  no  constitutional 
limitation,  there  is  no  provision  of  government,  there  is 
no  power  on  earth  against  these  people  redressing  a wrong 
when  it  becomes  a wrong. 

The  question  to  which  I think  the  attention  of  this 
conference  should  be  directed  is  whether  this  one  exists 
and  where  it  is.  I said  yesterday  that  I had  been  suf- 
fering through  every  portion  of  this  discussion  from  that 
dangerous  intoxication  of  phrases  which  seem  to  be  suffi- 
cient to  sustain  magnificent  periods,  and  when  all  is  over 
none  of  us  quite  know  what  we  have  been  talking  about. 

Now,  who  is  hurt,  and  where?  Where  has  this  octupus 
got  possession  of  somebody?  On  whom  is  it  acting? 
Where  is  its  lair?  I am  free  to  confess  that  when  you 
call  an  aggregation  of  capital  a combination,  a hydra- 
headed monster,  an  octupus,  it  doesnT  cast  any  light  upon 
it  that  illumines  my  pathway.  I can  understand  how 
ihe  use  of  these  phrases  can  have  some  effect,  as 
nothing  frightens  people  so  much  as  incomprehensive 
noises.  (Laughter  and  applause.)  Let  a noise  be  heard, 
here  now  and  none  of  us  understand,  and  we  will  all  be 
going  out  of  the  window.  (Applause.) 

DOING  PEETTY  WELL. 

Now  men  can  be  put  to  intellectual  and  physical  flight 
by  the  terrifying  noises  of  sound.  What  is  it  that  we 


174 


TRUSTS — PRO  AND  CON. 


hear?  Are  we  doing  pretty  well?  Well^  we  have  had 
here  representatives  of  labor  organizations  who  have  been 
telling  us  that  wages  are  higher  to-day  than  they  ever  have 
been.  Certainly  they  do  not  seem  to  suffer.  We  are  told 
that  it  is  not  the  dollar  that  we  want,  but  we  want  the 
man.  Well,  what  is  the  purpose  of  the  dollar  except  to 
improve  the  condition  of  the  man?  (Laughter.) 

I am  told  that  a God-made  man  is  one  thing  and  a 
man-made  man  is  another;  that  the  God-made  man  is  the 
very  attribute  of  divinity,  and  the  man-made  man  seems 
to  have  got  away  from  his  Creator  and  to  have  developed 
habits  of  depravity  during  the  separation.  Well,  now,  is 
there  such  a thing  as  a God-made  man  in  the  world? 
Why,  God-made  man  is  the  original  savage.  (Prolonged 
laughter.) 

Do  you  suppose  that  Mr.  Bryan  would  come  upon  this 
platform  and  give  the  oration  which  he  delivered  and  go 
over  the  world  speaking  to  multitudes  and  creating  wild 
enthusiasm  at  his  periods  from  the  original  resources  of 
man?  Why,  he  represents  centuries  of  cultivation.  The 
very  clothes  that  he  wears  have  all  been  contributed  to  him 
by  other  men,  and  in  that  sense  it  is  true  he  is  a fine  type 
of  the  God-made  man,  and  also,  thank  heaven,  he  is  a 
splendid  type  of  the  man-made  man.  (Applause.) 

I listen  to  my  friend  from  Indiana  with  great  interest, 
and  he  was  talking  about  suppressing  something  or  other. 
I wondered  why  it  was  and  I wonder  yet.  (Applause.) 
Do  you  want  competition  or  donT  you?  (A  voice:  ^^Yes, 
we  want  competition.^^)  Yes,  you  want  competition. 
There  is  a very  frank  man,  who  I believe  agrees  in  the 
main  with  the  proposition  of  Mr.  Bryan.  He  wants  com- 
petition. If  you  want  competition  must  not  somebody 
succeed  in  it?  Will  you  suppress  the  man  because  he  ex- 
cels another  so  far  that  he  constitutes  a monopoly?  . Are 
you  going  to  place  limits  upon  excellency?  (A  voice: 
^^We  object  to  the  railroads  being  used  for  the  benefit  of 
one  set  of  fellows  to  the  detriment  of  another.  That  is  a 
monopoly. ^^) 

Mr.  Cockran — I agree  with  you  there.  I would  invoke 
the  power  of  the  government  for  that  purpose. 


TKUSTS — PKO  AND  CON. 


175 


BECOMES  A MONOPOLY. 

Any  industrial  product  which  is  the  truth  of  human 
ingenuity  and  human  skill  in  every  instance  in  this  de- 
velopment and  production  and  excels  all  others^  it  be- 
comes a monopoly  while  that  excellency  lasts.  When  the 
excellency  decays  opposition  springs  up.  I venture  to 
take  Mr.  Bryan  himself  as  an  illustration  of  the  results 
of  the  freedom  of  competitioii.  If  you  are  going  to  de- 
stroy the  freedom  of  competition  and  the  excellency  which 
it  develops  and  the  domination  of  that  excellency  in  in- 
dustry, why  not  do  it  in  intellect?  Are  you  going  to 
curtail  the  efforts  of  the  competent  lawyer  to  aid  the 
smaller  lawyer  struggling  against  a superior  competitor, 
and  a doctor  who  hangs  out  his  shingle? 

If  you  are  going  to  stop  all  this  business  of  competition 
by  Mr.  Bryants  plan,  let  us  provide  that  congress  may  is- 
sue licenses  to  any  person  engaged  in  any  form  of  human 
activity  to  come  from  one  state  to  the  other  on  such  terms 
as  congress  provides.  Some  lawyers  might  be  shut  out 
from  coming  to  Washington  to  pratice  in  the  Supreme 
Court  of  the  United  States.  I would  like  to  shut  out 
som.e  myself.  The  possibilities  are  that  except  a sugges- 
tion is  made  there  would  be  a compromise  as  there  always 
is  in  radical  propositions.  (Applause.)  They  would 
probably  be  glad  to  issue  licenses  for  oratory,  because 
that  is  a department  in  which  all  of  its  members  would  be 
glad  to  compete  with  its  chief  exponent,  Mr.  Bryan,  for 
the  purpose  of  closing  the  distance  between  them. 

WANTS  TO  SEE  THE  EVIL. 

We  seem  to  have  drifted  into  an  atmosphere  of  bigness 
concerning  what  is  called  the  evil  of  monopolies.  Now, 
there  has  not  been  an  evil  given  that  has  been  attributed 
to  monopoly  here,  which,  if  it  existed,  I would  not  be 
enlisted  under  the  banner  of  those  to  suppress  it.  If  it 
be  an  evil  thing,  if  you  can  show  me  evil  upon  it,  I do  not 
hesitate  to  adopt  Mr.  Bryants  remedy.  If  you  point  out 
to  me,  as  Mr.  Bryan  did  this  morning^  the  fact  that  we 
have  not  seen  the  evils  of  this  monopoly  yet,  why,  then 
I say  you  are  simply  creating  a fanciful  picture;  your 


176 


TRUSTS — PRO  AND  CON. 


excessive  affection  for  your  fellows  has.  conjured  up  evils 
that  exist  only  in  your  own  brain.  Like  Don  Quixote  of 
old^  you  are  constituting  yourself  a knight  errant  of  po- 
litical economy — not  against  the  windmill,  but  enlisting 
the  windmill  on  your  side.  (Applause  and  laughter.)  If 
we  realize  for  the  moment  that  this  is  an  age  of  improve- 
ment, that  the  conditions  of  men  are  growing  better  and 
better,  we  ought  to  hesitate  a while  before  we  change  and 
take  the  side,  maybe,  for  one  of  fanciful  experiments. 

I believe  that  I can  say  with  perfect  sincerity  and  truth 
that  the  change  which  has  come  over  this  world  within 
th-e  last  ten  years  is  the  great  phenomena  of  civilization. 
It  has  been  but  ten  or  twelve  years  since  thu  public  parks 
had  to  be  approached  by  miserable  street  cars;  when  the 
only  method  of  locomotion  to  them  was  on  foot;  and  to-day 
the  mechanic  and  the  laborer  is  able  to  ride  to  them  upon 
improved  roads  and  upon  bicycles  which  they  own — en- 
tering into  the  possession  of  their  own — entering  into  the 
possession  of  their  own  improved  conditions,  showing  by 
the  health  of  their  cheeks  and  the  increased  efficiency  of 
their  armis  that  Almighty  God  is  guiding  His  people  for- 
ward, and  that  the  height  that  he  has  reached  is  not  a 
dizzy  eminence  from  v/hich  we  have  any^  reason  to  feel 
that  we  will  fall  to  disaster.  (Applause.) 

FUNCTIONS  OP  LABOR  UNIONS. 

You  ask  me  what  the  functions  of  the  labor  union  are. 
I tell  you  it  is  to  promote  that  closer  relationship  and  that 
quicker  distribution.  (Applause.)  I believe  when  the 
time  comes  that  the  employers  realize  to  themselves  that 
they  are  but  captains  of  industry,  that  they  are  but  part 
of  the  machinery  of  production,  that  they  are  but  directing 
the  energies  of  others,  because  by  that  direction  the  en- 
ergy is  greater,  more  fruitful  and  brings  larger  rewards  to 
each,  that  they  will  be  glad  to  welcome  the  trades  union 
as  a means  of  free  and  simple  interchange  of  opinion  be- 
tween their  partners  and  themselves.  The  curse  of  over- 
production is  not  the  inherent  difficulty  in  the  distribution, 
because  you  will  find  that  while  the  strike  is  raging  on  one 
system  of  railway  another  system  of  railway  which  gives 
no  higher  wages  and  exacts  no  longer  hours  is  in  the 


TRUSTS — PRO  AND  CON. 


177 


throes  of  a bloody  contest.  It  cannot  be  then  the  in- 
herent difficulty  of  the  distribution^  but  it  is  the  differ- 
ence in  the  characters  of  those  charged  with  its  adminis- 
tration. If  employers  and  employes  would  both  realize, 
and  I believe  from  the  papers  that  were  read  here  that 
the  employes  do,  that  the  volume  of  the  wages  is  regu- 
lated by  fixed  laws,  that  it  cannot  be  more  and  it  cannot  be 
less  than  it  is  worth,  the  employer  would  insist  upon  his 
employes  joining  the  union  for  the  purpose  of  facilitating 
discussion  between  them. 

ALL  TEND  TO  PEACE. 

They  cannot  change  the  laws  that  govern  their  relation- 
ship, but  they  can  discover  what  these  laws  are.  They 
can  save  time  in  the  discovery.  They  can  dwell  together 
in  peace,  and  the  time  saved  from  wrangling,  disorder  and 
riot  and  confusion  would  be  expended  in  production  and  in 
improving  the  condition  of  every  human  being  throughout 
the  country.  (Applause.) 

It  is  my  earnest  hope  and  it  is  my  firm  belief  that  as 
years  go  by,  and  the  very  minute  that  employers  realize 
that,  they  would  insist  on  their  employes  organizing  them- 
selves for  the  mere  purpose  of  facilitating  intercourse  be- 
tween them,  and  it  is  not  a Utopian  dream  that  before 
another  conference  of  this  character  assembles  the  largest 
employers  of  labor  will  insist  upon  their  employes  joining 
unions  and  choosing  representation  in  them,  realizing  that 
it  is  a joint  industry,  and  that  the  man  who  works  is  just 
as  valuable  as  the  man  who  directs  his  work.  (Ap- 
plause.) 

Let  me  advert  once  more  to  the  question  which  I con- 
sider of  vital  importance,  and  I hope  these  gentlemen  who 
have  put  questions  to  me  showing  a socialistic  opinion  will 
come  upon  this  platform.  I think  we  will  all  admit  that 
socialism  is  at  least  a distant  remedy,  conceding  it  to  be 
one.  I am  not  here  to  indulge  in  abstractions  or  specu- 
lations about  questions  which  are  necessarily  remote.  I 
came  to  this  conference  in  the  hope  that  we  could  make 
some  suggestions  which  might  be  immediately  adopted. 


178 


TRUSTS — PRO  AND  CON. 


POINTS  OP  AGEEEMENT. 

We  have  agreed,  I believe,  that  some  statute  should  be 
devised  to  provide  publicity  of  all  corporate  acts.  We 
have  agreed  that  a penalty  should  be  provided  against 
any  such  form  of  favor  by  a corporation  exercising  special 
franchises,  and  the  machinery  of  publicity  will  be  the 
means  of  discovering  it.  That,  I believe,  according  to  all 
of  us,  is  a distinct  gift.  I was  in  hopes  that  we  would 
discuss  these  industrial  disturbances,  and  that  we  might, 
at  least,  get  this  far  while  we  are  still  a short  distance 
from  the  socialistic  basis,  while  there  is  difficulty  about 
interfering  in  the  industry  of  private  citizens,  that  we  may 
provide  that  corporations  exercising  great  public  fran- 
chises should  be  held  to  some  accountability.  When  the 
convenience  of  the  public  is  suspended  by  the  suspension 
of  their  services  to  them,  when  the  railroad  company  is 
not  acting,  when  the  gas  company  is  not  supplying  its 
product,  when  any  great  enterprise  chartered  by  the  state 
and  depending  on  the  state  charter,  an  agency  of  the  state 
collapses,  it  is  the  business  of  the  state  to  ask  it  why,  and 
it  ought  to  be  at  once  the  right  of  every  citizen  who  is 
disturbed  by  that  cessation  to  demand  compensation. 
Now,  that  much  might  be  passed  by  the  concurrence  of 
every  person  in  this  conference.  When  that  is  passed,  I 
believe  the  beneficent  results  that  would  follow  from  it 
would  make  strikes  in  this  country  impossible. 

NOT  A NEW  SYSTEM. 

It  would  not  be  adopting  a new  system;  it  would  only 
be  compelling  the  recalcitrant  railroad  corporations,  the  ig- 
norant, benighted  management,  who  will  be  in  the  min- 
ority, to  assent  to  the  opinion  adopted  to-day  by  a mag- 
nificent majority.  I believe  that  there  are  many  laws  now 
in  existence  to  which  we  would  say  ^^God  speed,^^  dating 
from  to-day.  I doffit  ask  the  state  to  prescribe  any  con- 
ditions to  a settlement.  Let  it  be  a complete  defense  for 
the  railroad  to  say:  ^^We  have  met  these  men  by  agencies 
of  their  own  choosing,  and  we  have  discussed  this  question 
with  them.^^  Let  that  be  a complete  defense,  and  I tell  you 
that  then  you  will  have  accomplished  a solution  of  the  ques- 


TRUSTS — PRO  AND  CON. 


179 


tion,  because  there  cannot  be  a strike  between  an  employer 
and  employe  if  the  discussion  between  them  over  wages  or 
hours  is  conducted  in  the  spirit  of  the  hour  urged  here  by 
Mr.  Garland  and  Mr.  Gompers  from  this  platform.  (Great 
applause.) 

If  an  unjust  demand  is  made  the  railroad  presidents  or 
executive  has  but  to  demand  that  his  men  formulate  it. 
The  formulation  of  an  unjust  demand  would  raise  against 
the  laborer  the  public  opinion  which  now  is  upon  his  side, 
and  furnishes  him  the  weapon  of  the  boycott. 

My  suggestion  is  a suggestion  of  peace,  of  brotherhood; 
not  to  establish  any  new  law,  because  this  law  of  partner- 
ship has  existed  ever  since  free  labor  was  established 
throughout  the  world  through  the  intervention  of  Christi- 
anity. It  is  true  that  it  never  was  recognized  until  this 
day,  and  even  now  it  is  only  partially  seen.  I had  hopes 
that  this  conference  would  kindle  a great  light  throughout 
this  country,  that  it  would  direct  the  attention  of  all  the 
elements  engaged  in  industrial  co-operation  to  this  most 
pregnant  question. 

Mr.  Bryan  has  said  that  the  prosperity  of  the  people,  or 
in  other  words,  the  amount  of  wealth  they  can  create  is 
a sordid  question.  A sordid  question?  Why,  upon  this  the 
volume  of  production  of  everything  intellectual  and  moral 
depends.  Can  the  poet  live  in  the  sublime  and  beautiful 
as  long  as  the  food  which  supports  him  is  not  supplied  by 
other  hands?  Must  he  not  rely  upon  others  for  the  pen 
and  paper  and  other  materials  by  which  the  evolutions  of 
his  genius  are  given  circulation?  Must  not  the  philoso- 
pher who  surveys  the  wide  expanse  of  the  heavens  depend 
upon  other  hands  for  his  telescopes  and  mathematical  in- 
struments, and  whose  labor  re-enforces  his  discoveries?  Can 
the  physician  spend  days  and  nights  at  the  bedside  of  pain, 
fighting  death,  if  the  food  that  supports  him,  the  house 
that  shelters  him,  the  clothes  that  promote  his  comfort, 
and  the  medicines  that  re-enforce  his  skill  are  not  pro- 
duced by  the  efforts  of  other  men  whom  he  has  never  seen? 
Does  not  the  painter  use  the  labor  and  ingenuity  of  ten 
thousand  persons  in  the  pigments  and  paints  with  which 
he  casts  upon  the  canvas  the  sublime  conceptions  of  his 
genius?  Who  can  live  without  his  fellows?  Who  can 


180 


TKUSTS — PRO  AND  CON. 


raise  his  hands  in  a single  act  without  contributing  to  this 
grand  brotherhood  of  men,  which  I hope  this  conference 
will  bring  around  to  better  conceptions  of  the  relations 
which  bind  us  together  in  this  great  work  of  life. 


END  OF  CONFEBENCE. 


SENATOR  BLAIR. 

Among  the  succeeding  speakers  were  George  Schilling 
and  J ohn  P.  Scanlan.  Mr.  Gaines  moved  a vote  of  thanks 
to  the  Civic  Federation  and  the  City  of  Chicago.  Before 
passage  there  were  incorporated  the  names  of  the  chair- 
man and  secretary  and  ^‘^others  who  had  participated  in  the. 
plans  and  developments  of  the  conference.^^  Senator 
Blair  of  New  Hampshire  was  called  out  by  Chairman  Howe, 
who  said  that  the  little  corner  of  the  country — New  Eng- 
land— had  not  yet  been  heard  from. 

Mr.  Blair  said  among  other  things: 

If  you  remove  the  tariff  from  the  productions  of  our  great 
industrial  enterprises  they  will  put  their  capital  where  they 
can  produce  their  goods  the  cheapest.  Their  plants,  ma- 
chinery and  money  investments  would  be  removed  to  other 
countries,  where  their  goods  would  be  manufactured  by 
cheaper  labor  and  poured  into  our  markets,  thus  destroy- 
ing our  home  market. 


NO  RESOLUTIONS. 

Former  Governor  Luce  of  Michigan,  chairman  of  the 
resolutions  committee,  reported  at  this  juncture  the  set 
of  resolutions  adopted  to  the  effect  that  it  was  without  the 
province  of  the  conference  under  the  call  to  pass  resolu- 
tions. The  report  was  unanimously  adopted. 


TRUSTS — PRO  AND  CON. 


181 


THE  LAST  WORD. 


CHAIRMAN  HOWE. 

The  last  word  in  the  conference  by  way  of  paper,  speech 
or  debate,  was  from  the  permanent  chairman,  William 
Wirt  Howe  of  New  Orleans.  He  explained  that  he  had 
prepared  a paper  before  reaching  Chicago  at  the  request  of 
the  Civic  Federation.  In  part  he  said: 

Where  do  we  stand  after  four  days  of  discussion,  al- 
ways interesting,  often  profoundly  scientific  and  sometimes 
rising  into  the  brilliant  sphere  of  oratory?  It  seems  to  me, 
simply  as  an  individual,  of  course,  that  almost  every  paper 
or  address  we  have  heard  has  made  some  admissions  or 
concessions  which  may  form  a basis  for  some  conclusions, 
and  if  you  will  allow  me  I will  formulate  some  of  them  as 
follows: 

1.  That  combinations  and  conspiracies  in  the  form  of 
trusts  or  otherwise  in  restraint  of  trade  or  manufacture, 
which  by  the  concensus  of  judicial  opinion  are  unlawful, 
should  be  so  declared  by  legislation,  with  suitable  sanc- 
tions, and  if  possible  by  a statute  uniform  in  all  jurisdic- 
tions, and  also  uniform  as  to  all  persons,  and  that  such  a 
statute  should  be  thoroughly  enforced  so  that  those  who 
respect  it  shall  not  be  at  a disadvantage  as  compared  with 
those  who  disregard  it. 

2.  That  the  organization  of  trading  and  industrial  cor- 
porations, whether  under  general  or  special  laws,  be  per- 
mitted only  under  a system  of  careful  government  control, 
also  uniform  if  possible  in  all  jurisdictions  whereby  we 
think  that  many  of  the  evils  of  which  complaint  is  now 
made  may  be  avoided. 

FAVOES  SYSTEM  OF  EEPOETS. 

3.  The  objects  of  the  corporation  should  be  confined 
within  limits  definite  and  certain.  The  issue  of  stock  and 
bonds,^j^yill|B^s  been  a matter  of  so  much  just  criticism 


182 


TRUSTS — PRO  A>^D  CON. 


and  complaint,  should  be  guarded  with  great  strictness. 
If  mortgage  bonds  seem  to  be  required  they  should  be  al- 
lowed only  for  a moderate  fraction  of  the  true  cash  value 
of  the  property  that  secures  them.  As  for  issues  of  stock, 
they  should  be  safeguarded  in  every  possible  way.  They 
should  only  be  allowed  either  for  money  or  for  property 
actually  received  by  the  company,  and  dollar  for  dollar, 
and  when  the  property  is  so  conveyed  it  should  be  on  an 
honest  appraisement  of  actual  value,  so  that  there  may  be 
no  watering  of  stock. 

4.  And,  finally,  there  should  be  a thorough  system  of 
reports  and  governmental  inspection,  especially  as  to  issues 
of  bonds  and  stock  and  the  status  and  value  of  property. 
Yet  at  the  same  time  in  the  matter  of  trading,  business  and 
industrial  companies,  there  are  many  legitimate  secrets 
which  must  be  respected  by  the  general  public.  In  short, 
we  need  to  frankly  recognize  the  fact  that  trading  and  in- 
dustrial corporations  are  needed  to  organize  the  activities 
of  our  country,  and  that  they  are  not  to  be  scolded  or  be- 
lied, but  controlled,  as  we  control  steam  and  electricity, 
which  are  also  dangerous  if  not  carefully  managed,  but  of 
wonderful  usefulness  if  rightly  harnessed  to  the  car  of 
progress. 

5.  We  agree  without  a dissenting  voice  in  thanking  the 
Civic  Federation  of  Chicago  for  furnishing  this  oppor- 
tunity for  education,  and  the  people  of  Chicago,  not  only 
for  a hospitality  as  large  as  its  limits,  but  for  the  object 
lesson  their  city  affords  to  teach  us  what  can  be  done  in 
America  by  enlightened  public  spirit  in  associated  effort. 


Upon  motion  of  Louis  F.  Post  of  Chicago,  the  confer- 
ence on  trusts  and  combinations  adjourned  sine  die  at 
exactly  6 o^clock. 


